Compound Interest Calculator

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The Power of Compound Interest in the US Market

Albert Einstein reportedly called compound interest the eighth wonder of the world. Our US Compound Interest Calculator allows you to project the future value of your investments—whether that's a high-yield savings account, an index fund, or a diversified stock portfolio.

How Compounding Works

Simple interest only pays you on your initial deposit (the principal). Compound interest pays you on your principal AND on the interest you've already earned. As time goes on, this creates an exponential snowball effect that is the cornerstone of US retirement planning.

The standard formula for compound interest is: A = P(1 + r/n)^(nt)

Frequently Asked Questions

What is a realistic APY?

Historically, the US S&P 500 stock market index has returned an average of about 7% to 10% annually after adjusting for inflation. High-yield savings accounts typically offer 4% to 5% in high-rate environments.

Does compounding frequency matter?

Yes! Daily compounding will yield slightly more than monthly or annual compounding over the exact same period and interest rate.