📈 Compound Interest Calculator

Compound interest earns interest on interest — your returns get added to the principal, then the next period's interest is calculated on the larger amount. Over decades, this creates exponential growth. Einstein reportedly called it "the eighth wonder of the world."

More frequent compounding = slightly more growth. Daily vs. monthly is a small difference. What matters far more is the interest rate and how long you invest. Starting earlier has a bigger impact than compounding frequency.

Divide 72 by your annual return rate to estimate years to double your money. At 6%: 72 ÷ 6 = 12 years. At 9%: 72 ÷ 9 = 8 years. It's a quick mental math shortcut that's surprisingly accurate.

APR is the stated rate without compounding effects. APY (Annual Percentage Yield) reflects the actual annual return including compounding. APY is always ≥ APR. Always compare APY when evaluating savings accounts or investments.

If you earn 7% but inflation is 3%, your real purchasing power only grows ~4% per year. This calculator shows both nominal (stated) and real (inflation-adjusted) values so you can plan accurately.