# Compound interest calculator

> Machine-readable mirror for AI agents. Canonical page: https://www.portfolioglance.com/calculators/investment-calculator
> Content language: English.

> Other languages: append `?hl=pl` for Polish, `?hl=tr` for Turkish to this URL.

Compounding is what happens when your investment returns start earning their own returns. Instead of just your original money growing, the profits you've already made also grow — so your wealth builds faster over time. Use this calculator to see how regular contributions and compound interest could grow your investments, based on how much you plan to invest and the average return rate.

> Each calculator serializes its inputs into the URL query string of its interactive page, so a filled-in scenario is a shareable link.

## How does compound interest work?

Compound interest is often called the eighth wonder of the world. When you invest money, you earn returns. With compounding, those returns get reinvested and start earning returns of their own. Over time, this creates a snowball effect — your money grows faster and faster. The earlier you start and the more consistently you invest, the more powerful compounding becomes. Even small, regular contributions can grow into significant wealth over 20 or 30 years.

## Frequently asked questions

### What is compound interest?

Compound interest means you earn returns not only on your original investment, but also on any returns you've already earned. For example, if you invest $1,000 and earn 7% in the first year ($70), the next year you earn 7% on $1,070 — not just $1,000. Over time, this creates exponential growth.

### How much should I invest monthly?

There is no one-size-fits-all answer. A common guideline is to invest 10-20% of your income. Even $50 or $100 per month can grow significantly over decades thanks to compounding. The most important thing is to start early and be consistent.

### What is a realistic annual return rate?

Long-term, the S&P 500 index has averaged about 10% per year before inflation, roughly 7% in real terms. Bond returns are typically lower (3-5%), while higher-risk investments can deliver more but with greater volatility. A 7% annual return is often used as a cautious assumption for long-term stock market investing.

### Does contribution frequency matter?

Yes, but the difference is usually small. More frequent contributions (daily or weekly vs. monthly) mean your money starts compounding slightly sooner. The much bigger factor is how much you invest total and how long you stay invested.

*This calculator provides estimates for educational purposes only. Actual investment returns vary and past performance does not guarantee future results. Consult a qualified financial advisor before making investment decisions.*