Monthly Compound Interest Calculator
See how savings grow when interest compounds monthly. Add a monthly deposit and watch the balance build.
Monthly compounding adds interest to your balance twelve times a year. Many money market accounts and CDs work this way.
Pair it with a monthly deposit and the two habits reinforce each other.
How it works
The monthly rate is the annual rate divided by 12. It is applied to the balance at the end of each month, then your deposit is added.
The table shows the balance at the end of each year. The chart shows how much of it came from interest.
The formula
A = final amount, P = starting amount, r = annual rate as a decimal, t = years.
Tips
- Set the deposit up as an automatic transfer. Consistency beats timing.
- Raise the deposit whenever your income rises. Even $25 more a month compounds.
Frequently asked questions
When is the deposit added?
At the end of each month, after that month's interest. Depositing at the start of the month would give a slightly higher result.
What rate should I use?
Use the APY your account advertises for savings. For investments many people use 6% to 8% as a long run estimate.
This is not financial advice. Nothing on this site is investment, tax, legal or financial advice of any kind.
The calculators give simplified estimates from the numbers you enter. They ignore taxes, fees, rate changes and real market returns, and they can be wrong.
Do not make financial decisions based on these results. Speak to a licensed financial adviser, accountant or lender before acting, and read the full disclaimer.