Tool · Calculator
Compound Interest Calculator
See how your savings grow with regular contributions and compounding returns. Australian dollars, monthly compounding, and a year-by-year breakdown.
Enter a starting balance, your regular monthly contribution, and an expected annual rate of return to project an estimated future value. The year-by-year breakdown shows how much of your balance is money you put in versus interest the money earned on its own.
Compound Interest
Estimate how your money grows with consistent contributions and compounding.
Estimated balance in 15 years
$186,971
Total contributed
$100,000
Interest earned
$86,971
Hover or tap any year to see what you've contributed and what compounding has added on top.
The copper band is the compounding doing its work. In the early years it's a thin stripe on top of your contributions, but it widens as the balance grows - because each year's interest earns interest of its own the year after.
This is the calculator I use to sanity-check my own numbers. It gives estimates, not advice - what to do with the result is yours to work out.
Frequently asked questions
- How does compound interest work?
- Compound interest is interest earned on both your original balance and the interest already added. Each period the return is calculated on the new, larger balance, so growth accelerates over time. The longer your money compounds and the more often it compounds, the bigger the effect.
- What's the difference between simple and compound interest?
- Simple interest is paid only on your original balance, so it grows in a straight line. Compound interest is paid on the balance plus accumulated interest, so it grows on a curve. Over a long horizon the gap between the two becomes very large, which is why compounding is described as the most powerful force in saving.
- Why do my regular contributions matter so much?
- Every contribution you make starts compounding from the day it lands, so money added early has decades to grow while money added late has only a few years. Consistent monthly contributions usually do more heavy lifting than chasing a slightly higher return, especially in the first half of a long savings plan.
- What return should I assume?
- It depends entirely on where the money sits. A high-interest savings account might return a few per cent, while a long-run diversified share portfolio has historically returned somewhere around 7 to 10 per cent before fees and tax, with far more volatility. Use a conservative figure for planning and treat the result as an estimate, not a promise.