Wealth Analytics • Compounding & Investment Growth
Compound Interest Calculator
Time in the market beats timing the market — but by how much, exactly? This free compound interest calculator projects your investment growth with monthly contributions, yearly breakdowns, and total interest earned, so your retirement planning starts from real numbers.
1. Nominal APY vs. Real Post-Inflation Yield
A common pitfall in yield farming and staking is prioritizing high nominal APY percentages without factoring in baseline network token inflation. For instance, if a network offers 14% nominal staking rewards but dilutes circulating supply by 10% annually, your real purchasing power expansion is only ~3.6%.
2. Liquid Staking Derivatives (LSTs) & Capital Efficiency
Liquid staking protocols (such as Lido stETH, Rocket Pool rETH, and JitoSOL) allow institutional participants to maintain yield generation while retaining liquidity for DeFi lending and liquidity provision. However, LSTs introduce smart contract and depeg risk that must be modeled into portfolio variance.
How Compound Interest Works
Compound interest means earning returns on your returns. Leave $10,000 invested at 7% for 20 years with no additions and it grows to about $38,700 — nearly 4× your money, with zero extra effort after the first deposit. Add $500/month and it becomes roughly $299,000.
The formula
A = P × (1 + r/n)^(n×t) — principal × one plus rate over compounding periods, raised to total periods. Monthly contributions add a second compounding stream, which is why starting early beats investing more later.
The Rule of 72
Divide 72 by your annual rate to estimate doubling time: at 7%, money doubles every ~10.3 years; at 10%, every ~7.2 years. A quick sanity check for any investment or retirement planning projection.
What the calculator assumes
- Monthly compounding with contributions at each month-end
- A constant annual rate — real markets fluctuate
- No taxes, inflation, or fees — treat results as a planning baseline, then haircut for reality
Compound Interest Calculator — Frequently Asked Questions
What is the compound interest formula?
A = P × (1 + r/n)^(n×t): principal times one plus the periodic rate, raised to the number of periods. With regular contributions, each deposit compounds for its remaining time — our calculator handles this automatically.
What is the Rule of 72?
Divide 72 by your annual return to estimate years to double your money. At 8%, doubling takes ~9 years. It is an approximation, not a guarantee.
Is monthly or annual compounding better?
More frequent compounding is always slightly better — monthly beats annual, daily beats monthly. The difference is small at low rates and meaningful over decades.
How much do I need to invest monthly to reach $1 million?
At 7% annual return over 30 years, about $820/month from zero reaches $1M. Try your own numbers above — time matters more than amount.
Does this account for inflation and taxes?
No. Subtract expected inflation (~2–3%) from your rate for a "real return" view, and remember investment gains are typically taxed. Use the result as a planning baseline.