Free savings calculator: see how your savings grow with compound interest, regular deposits and time. Set your rate and goal to project your balance.
The compound interest formula is: A = P(1 + r/n)^(nt) + PMT × ((1 + r/n)^(nt) − 1) / (r/n), where P is the initial deposit, r is the annual interest rate, n is compounding periods per year, t is years, and PMT is the monthly contribution.
The most powerful factor in savings is time. $5,000 invested at 7% for 40 years grows to $74,872 — even with no additional contributions. Add $200/month and the final balance reaches $560,000. Starting 10 years earlier can more than double your final balance.
The second most important factor is the interest rate. Even small differences compound significantly over decades. Going from 5% to 7% over 30 years more than doubles your ending balance on the same contributions.
Divide 72 by your annual interest rate to estimate how many years it takes to double your money. At 6%: 72 ÷ 6 = 12 years to double. At 8%: 72 ÷ 8 = 9 years.
Savings grow through compound interest: each period's interest is added to the balance and itself earns interest. With regular deposits, the future value combines growth of the initial balance plus the future value of the deposit stream.
Starting with $1,000 and adding $200 monthly at 4% APY compounded monthly, after 10 years you would have roughly $30,900 — of which $5,500 is interest earned on total deposits of $25,000.
What is the difference between APR and APY? APY includes compounding; APR does not. A 4% APR compounded monthly equals about 4.07% APY.
How often should interest compound? More frequent compounding helps slightly, but the rate itself matters far more than the compounding schedule.
Does inflation matter? Yes — subtract expected inflation from your rate to see real purchasing-power growth. A 4% return during 3% inflation grows real value only about 1% per year.