Compound Interest Calculator
Written by Thierno Sadou Diallo, formula verified per our methodology • Last checked on 9/3/2026
Compound interest lets your gains generate interest of their own. Over 10 years, starting with €1,000 and adding €100/month at 5%, you end up with about €17,175.
Explanation
Compound interest works by capitalizing on returns. Unlike simple interest, which is calculated only on the initial capital, compound interest folds past gains back into the calculation for every period. The longer the duration and the higher the rate, the more this compounding effect amplifies. This calculator lets you simulate your savings, taking into account both your initial capital and the regular contributions you add over time. It's the same mathematical mechanism as a loan being paid off, but in reverse: our mortgage calculator applies the same type of formula to a balance that shrinks with each repayment, rather than savings that grow.
Detailed example: saving over 10 years
Inputs
€1,000 to start, €100/month, a 5%/year rate over 10 years.
Calculation
Each month, interest is calculated on the entire capital accumulated the previous month, not just the initial capital. In the first month, you earn €1,000 × (5% / 12) ≈ €4.17. The next month, you earn interest not only on the initial €1,000, but also on the €4.17 earned previously. After 120 months (10 years), this mechanism has generated about €4,175 in net gain (pure interest).
Result
After 10 years, you've contributed €13,000 (€1,000 initial + €100 × 120 months) and earned about €4,175 in compound interest, for a total of about €17,175.
Frequently asked questions
What's the difference between simple and compound interest?
Simple interest is calculated only on the starting capital and does not include prior gains. Compound interest folds past gains back into the calculation for every period, creating a "snowball" effect that accelerates the growth of the capital.
How often is interest actually calculated in real life?
This calculator assumes monthly compounding, which is common for standard savings accounts. Regulated French savings accounts (Livret A, LDDS) work differently: interest is calculated by fortnight (the 1st and the 16th of each month), but is only capitalized — added to the principal, where it then starts earning interest itself — once a year, on December 31st. Check your own savings product's terms for its exact compounding frequency.
What if I don't add a monthly contribution?
Enter €0 for the monthly contribution. In that case, only the initial capital will grow through compound interest. The calculation stays valid and shows you the effect of compounding on a fixed amount.
What rate should I use?
Check with your bank or savings contract for the exact annual rate. This calculator accepts any rate between 0% and 20%, but real rates vary widely depending on the product (savings account, life insurance, etc.) and the economic context.