FUTURE VALUE
$0
Total contributed$0
Total interest earned$0
How Compound Interest Works
Compound interest is interest calculated on both your initial investment and previously earned interest, creating exponential growth over time.
The Formula
A = P(1 + r/n)^(nt) plus regular contributions compounded over the same period.
Why Starting Early Matters
Time is often more powerful than amount invested. Starting at 25 can beat starting at 40 with double the monthly amount, simply due to more compounding years.
Frequently Asked Questions
Is this accurate for stock market investing?
This assumes a constant annual return; real markets fluctuate, so this is a long-term estimate, not a guarantee.
Should I include taxes?
This shows pre-tax growth; actual returns may be lower in a taxable account.
What's a realistic rate to use?
Historical stock market averages are often cited around 7-10% annually; savings accounts offer much lower rates.