Compound Interest Calculator
Enter a starting balance, a contribution, a rate and a period, and this returns the final balance, how much of it you put in yourself, and how much came from compounding — the split that shows when growth starts doing the work.
The formula
FV = P(1 + i)N + C × [((1 + i)N − 1) ÷ i], where i is the periodic rate (annual ÷ frequency) and N is the number of periods. Contributions are assumed to arrive at the end of each period.
Read the split, not the total
The interesting line is not the final balance, it is how much of it you contributed versus how much compounding produced. In the default, $130,000 goes in and the balance ends around $344,000 — roughly 62% of the result is growth. Shorten the period to five years and that share collapses to about 15%. Compounding is almost entirely a function of time, and the first years feel like nothing is happening because nothing much is.
The assumption this makes, and why it flatters
A constant 8% every single period is not how markets behave, and the difference is not neutral. A sequence averaging 8% with real volatility ends up below a smooth 8%, because losses compound against you more than equivalent gains compound for you — down 20% then up 20% leaves you at 96, not 100. The drawdown recovery calculator makes that asymmetry explicit.
So treat this number as an upper bound on a smooth path, not a forecast. It is genuinely useful for comparing scenarios — is it better to add $200 a month or start three years earlier? — and genuinely misleading if read as a prediction.
For trading accounts specifically
Applying this to a trading account with an assumed monthly percentage return is where it goes badly wrong. A 5% monthly return compounds to 80% a year on paper; almost nobody delivers it, and the ones who appear to are usually reporting selectively. If you want to model an account growing on per-trade returns with withdrawals, use the account compounding calculator, which is built for that and says the same thing more bluntly.
Why a constant rate flatters
Real returns arrive with drawdowns, and a presentation that omits them fails the standard the profession uses: GIPS requires fair representation and full disclosure across every portfolio in a composite.[1] Treat this curve as a ceiling rather than a forecast.
The number is the easy part
Everything above is arithmetic, and anyone opening this page gets the same answer. What no calculator can settle is whether you took the trade on these terms, or are describing — afterwards — the version of it that worked out.
That is what a trade recorder is for: the trade committed before it resolves, timestamped and sealed on the spot, on a Merkle-anchored log a stranger can check without kappi's cooperation. The plan you typed here stops being a plan you remember having. $15/month, no free tier.
Sources
Frequently asked questions
What is the compound interest formula with regular contributions?
FV = P(1+i)^N + C[((1+i)^N − 1)/i], where i is the rate per period and N the number of periods. Contributions here are assumed at the end of each period.
Does compounding frequency make much difference?
Less than most people expect. At 8% a year, monthly rather than annual compounding adds roughly 0.3 percentage points of effective annual return.
Why does a constant return overstate real growth?
Volatility drags. A sequence averaging 8% with real ups and downs ends below a smooth 8%, because a loss requires a larger percentage gain to undo.
Can I use this for a trading account?
Only loosely. Assuming a fixed monthly percentage return compounds into figures nobody sustains. The account compounding calculator handles that case more honestly.