How compounding works
Compound interest is the addition of interest to the principal sum, so that interest earns interest.
Key Factors:
- Initial investment amount
- Annual interest rate
- Time (years invested)
- Regular contributions (optional)
Tips:
- Start early to maximize time
- Higher rates dramatically increase growth
- Even small regular contributions add up
Your Investment Growth
Year-by-Year Growth
| Year | Starting | Contributions | Interest | Ending Balance |
|---|
Disclaimer: This tool is for educational purposes only. It does not constitute financial advice.