Compound Interest Calculator

See how savings grow when interest is earned on interest. Enter a starting balance, regular deposits, a rate and a time frame, and compare what the money becomes over the years.

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What this calculator works out

Simple interest is paid on the original amount only. Compound interest is paid on the original amount plus all the interest already earned, so the balance grows faster every year it is left alone. The calculator shows four results.

Your future balance

What the account is worth at the end of the period, including your starting balance, your deposits and every dollar of interest.

Interest earned

The part of the final balance that came from interest rather than from you. Over long periods it can end up larger than everything you put in.

Your own contributions

The starting balance plus the total of your regular deposits. This part you control directly, and it matters most in the early years.

The effect of compounding frequency

Interest added daily, monthly or yearly. More frequent compounding helps a little, but far less than the rate, the deposits or the time you leave it.
The same arithmetic works in reverse on debt. A balance that is charged interest and not paid down grows by the same formula, which is why an unpaid credit card grows so quickly. The credit card calculator shows the payoff side.

The formula, and the one input that matters most

Compound growth has three levers: the rate, the frequency of compounding and time. Of the three, time does most of the work, because it is the exponent in the formula.
Compound interest formula

A = P × (1 + r ÷ n)n × t

A is the final balance, P the starting balance, r the annual rate as a decimal, n the number of times interest is added each year and t the number of years. Regular deposits add a second term, each deposit compounding from the date it is made.
Two things about that formula are worth pausing on.

First, the n × t term is an exponent. Doubling the time more than doubles the interest, which is why starting five years earlier often beats finding a slightly higher rate.

Second, the formula assumes the rate never changes and no tax is paid. Savings rates move, and interest earned is taxable income, so a real balance usually grows a little slower than the calculator shows.

What $10,000 becomes at five rates

Each card shows a single $10,000 deposit, with no further deposits, left to compound monthly at an assumed rate. Before tax and fees.

At 3 per cent

5 years  $11,616
10 years  $13,494
20 years  $18,208
30 years  $24,568

At 4 per cent

5 years  $12,210
10 years  $14,908
20 years  $22,226
30 years  $33,135

At 5 per cent

5 years  $12,834
10 years  $16,470
20 years  $27,126
30 years  $44,677

At 6 per cent

5 years  $13,489
10 years  $18,194
20 years  $33,102
30 years  $60,226

At 7 per cent

5 years  $14,176
10 years  $20,097
20 years  $40,387
30 years  $81,165
Read across the 5 year row, then the 30 year row. Over five years, the gap between 3 and 7 per cent is about $2,600. Over thirty years it is about $56,600. The rate matters, but only time gives it room to matter.

Worked example: frequency, deposits and debt

The figures below are illustrative and are not a rate offer, a quote, or a prediction. They show how the arithmetic behaves.

$10,000 for 20 years at an assumed 5 per cent
Compounded yearly, about $26,533.
Compounded monthly, about $27,126.
Compounded daily, about $27,181.
Daily instead of yearly adds only about $648 over 20 years.

Add $200 a month to the same account
Final balance about $109,333. You deposit $58,000 in total; about $51,333 is interest.

The same maths on debt
A $5,000 credit card balance charged an assumed 20 per cent a year, compounding monthly, with nothing paid and no fees, grows to about $6,097 in one year, $7,435 in two and $9,066 in three.
This is why the practical order is: start early, add regularly, then look for a strong rate you can actually keep. Compounding frequency comes last. And on the debt side, the same maths is the best argument for clearing high-interest balances first.

What the calculator does not show you

The formula is exact, but real accounts and real lives add friction. Each of these can make the true figure lower.

Tax on interest

Interest is income and is taxed at your marginal rate. At the 30c rate plus Medicare, about a third of each year’s interest goes in tax, which slows the compounding. The Australian income tax calculator shows your marginal rate.

Rates that change

Savings rates move with the market, and bonus rates often depend on meeting monthly conditions. A single fixed rate for 20 or 30 years is a planning assumption, not a promise.

Inflation

A balance that grows by 3 per cent a year while prices rise by 3 per cent a year has not grown in what it can buy. Compare your rate with inflation, not just with zero.

Fees and withdrawals

Account fees and any money taken out reset the compounding on that amount. A single early withdrawal can cost more in lost interest than it looks like at the time.

Before you choose an account

Compare accounts on the rate you will realistically earn after conditions, not the headline bonus rate. Check whether interest is paid monthly or at maturity, whether there are fees, and whether the account is with a bank, building society or credit union covered by the Government’s Financial Claims Scheme, which protects deposits up to $250,000 per account holder per institution. Then automate the deposit so the time lever keeps working. If the balance sits beside a home loan, an offset account can earn you your loan rate instead, see the home loan offset calculator.
Related tools on this site: savings goal calculator if you want to know how long it takes to reach a target, how much to deposit calculator if you have a deadline, extra repayment calculator and budget planner. Saving for your first place? Start with first home buyer loans.
Sources
Australian Government, ASIC Moneysmart: Compound interest, Compound interest calculator and Mortgage offset accounts, which puts the average credit card rate above 18 per cent as at May 2026.
Financial Claims Scheme: fcs.gov.au.
Australian Taxation Office: Tax rates, Australian residents.

About the figures on this page. Every balance was calculated directly from the compound interest formula shown above, and the 3 per cent row matches Moneysmart’s own worked example. The rates are assumptions for illustration and are not an offer or a forecast.

Important information about this calculator. This calculator projects a balance from the starting amount, deposits, rate, compounding frequency and time you enter. It assumes a constant rate, deposits made on schedule and no withdrawals, and it does not account for tax on interest, fees, bonus rate conditions or inflation. Results are estimates only. Past returns and advertised rates are not a reliable guide to future returns.

General information only. Nothing on this page takes your objectives, financial situation or needs into account, and it is not financial or tax advice. Loanity is a credit representative and can provide credit assistance once we understand your circumstances.
STILL GOT QUESTIONS?

Compound interest questions, answered

How do I calculate compound interest?

Use A = P × (1 + r ÷ n)^(n × t), where P is the starting balance, r the annual rate, n the number of times interest is added each year and t the number of years. $10,000 at an assumed 5 per cent compounded monthly for 10 years becomes about $16,470.

Simple interest is paid on the original amount only. Compound interest is paid on the original amount plus interest already earned, so the balance grows faster each year. Over long periods the difference becomes very large.

Less than people expect. $10,000 at an assumed 5 per cent over 20 years becomes about $26,533 compounded yearly, $27,126 monthly and $27,181 daily. The rate and the time matter far more.

A quick guide is the rule of 72: divide 72 by the rate. At an assumed 6 per cent, money roughly doubles in 12 years. It is an approximation and ignores tax and fees.

A lot. $10,000 left alone at an assumed 5 per cent for 20 years becomes about $27,126. Add $200 a month and it becomes about $109,333, of which $58,000 is your own money and about $51,333 is interest.

Yes. Interest is income and is taxed at your marginal rate in your tax return. If you have not given your bank your tax file number, it may withhold tax from the interest.

Yes. Interest charged on a balance and not paid off is added to the balance and then charged interest itself. Moneysmart puts the average credit card rate above 18 per cent as at May 2026, which is why an unpaid card balance grows quickly.

Use the rate you expect to earn after any bonus conditions, not the highest advertised rate. For long periods, a lower assumption is safer, because rates change and tax reduces what stays in the account.

The formula is the same, but investment returns are not guaranteed and can be negative in some years. A savings account rate is more predictable than the average return on shares or property.

We do not charge you a fee for arranging your finance. Brokers are generally paid a commission by the lender when a loan settles. If any fee from us would ever apply to your situation, you would be told in writing before you proceeded.