Compound interest calculator
Your numbers
- After 25 years
- $462,290
- You put in
- $160,000
- Growth
- $302,290
Growth is 65% of the final amount.
The formula
For a single amount, the value after some years is:
A = P × (1 + r / n)^(n × t)
P = starting amount, r = yearly rate, n = times it compounds per year, t = years.
Regular additions are each compounded for the time they're invested, which is what the calculator above adds up month by month. It uses the same engine as the retirement calculator.
The rule of 72
To estimate how long money takes to double, divide 72 by the yearly return. At 7% that gives about 10 years; the exact answer is 9.9 years.
The useful part is how few doublings separate a small sum from a large one. Money that doubles every 10 years grows about 16 times over 40 years.
Why starting early matters
Time is the input that compounds hardest. With your numbers, starting today gives $462,290 after 25 years. Starting ten years later with the same amounts gives $186,971: you'd put in $60,000 less, but end up with $275,319 less.
That's why the first years of saving count for so much in a FIRE plan, and why the Coast FIRE idea works: money invested early can grow into a full retirement with no further help.
Fees and inflation
Both compound against you. A fund charging 1% a year turns a 7% return into 6%, and over 30 years that costs about a fifth of the final amount compared with a 0.2% index fund. Inflation doesn't reduce the number on your statement, but it reduces what it buys: at 2.5% inflation, prices roughly double in 28 years.
The retirement calculator handles both: set your fees under "More options" and switch results to "today's money". New to the idea? Start with what FIRE is.
Questions people ask
- How often should interest compound?
- More often is slightly better, but the difference is small: 7% compounded monthly is the same as about 7.23% compounded yearly. How much you add and for how long matter far more.
- Is compound interest the same as investment returns?
- Not quite. A savings account pays a known rate. Investments like stock funds go up and down, so the 7% here is an average. Over long periods the maths works the same way, but the path is bumpy.
- What is the rule of 72?
- Divide 72 by the yearly return to estimate how many years it takes for money to double. At 6% it doubles in about 12 years; at 9%, about 8.
- Does inflation cancel out compound interest?
- Part of it. If you earn 7% and prices rise 2.5%, your buying power grows by about 4.4% a year. The retirement calculator shows results in today's money so you can see this.
- How much do fees matter?
- A lot, because they compound too. Over 30 years, paying 1% a year instead of 0.2% leaves you with roughly 20% less.
Run your own numbers
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Open the calculatorFor education only, not personal financial advice.