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Compound Interest

See how an investment grows with compound interest and regular contributions, year by year.

€
€
%
yrs
Final balance€67,296.30
Total contributed€34,000.00
Total interest€33,296.30

Breakdown: contributions vs interest

  • Contributions · 51%
  • Interest · 49%

Investment growth over time

€100,000€75,000€50,000€25,000€0
146912151720
  • Balance
  • Contributed
  • Interest

Growth per year

YearContributedInterestBalance
1€11,200€512€11,712
2€12,400€1,111€13,511
3€13,600€1,802€15,402
4€14,800€2,590€17,390
5€16,000€3,480€19,480
6€17,200€4,476€21,676
7€18,400€5,585€23,985
8€19,600€6,813€26,413
9€20,800€8,164€28,964
10€22,000€9,646€31,646
11€23,200€11,265€34,465
12€24,400€13,028€37,428
13€25,600€14,943€40,543
14€26,800€17,017€43,817
15€28,000€19,259€47,259
16€29,200€21,677€50,877
17€30,400€24,280€54,680
18€31,600€27,077€58,677
19€32,800€30,079€62,879
20€34,000€33,296€67,296

How it works

Compound interest shows how a sum grows when interest is added to the principal and itself earns interest. The more frequent the compounding, the higher the final value.

The formula is A = P · (1 + r/n)^(n·t), where P is the starting principal, r the annual rate, n the compounding periods per year and t the years. Regular deposits add the future value of those contributions.

Example: €1,000 at 5% compounded yearly becomes about €1,629 in 10 years.

Frequently asked questions

What is compounding?

It is adding earned interest back to the principal, so the next period a larger amount earns interest.

How much does compounding frequency matter?

The more frequent (monthly vs yearly), the higher the final value, though the gain shrinks at very high frequencies.

How does it differ from simple interest?

Simple interest is calculated only on the original principal; compound interest also on accumulated interest, so it grows faster.

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