How Compound Interest Works

Compounding means your earnings start earning too. Over long stretches of time, that effect can grow larger than the money you put in. Adjust the numbers to see how time, contributions, and rate of return work together.

About these numbers

Assumes the same rate of return every year with no taxes, fees, or withdrawals. Actual investment returns vary and can be negative.

This calculator is a hypothetical illustration for educational purposes only. Results are based on the assumptions you enter and the method described above, may vary with each use and over time, do not reflect any specific investment or the deduction of fees or taxes unless stated, and are not a guarantee of future results. The tool does not consider every investment, account type, or strategy that may be available to you. It is not investment, tax, or legal advice. Investing involves risk, including possible loss of principal. 4:8 Financial does not provide tax or legal advice; please consult your CPA or attorney regarding your specific situation.

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