Compound Interest Calculator 2026/27
See how your savings and investments can grow over time with compounding. Start with your lump sum and regular contributions here, then adjust the interest rate, compounding frequency and investment term below.
Quick setup
Projected Final Value
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Interest Earned
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Use these quick inputs to set your starting point, then fine- tune contribution frequency, interest rate, compounding and investment term in the full calculator below.
What compound interest is
Compound interest is interest earned on your original money and on the interest it has already earned. Over time this snowballs: your money grows faster each year, often described as "interest on interest". Even modest returns, compounded over decades, can grow a small starting amount a long way.
How it works
Each time interest is paid, it is added to your balance. The next payment is worked out on that slightly larger balance, so your money grows a little faster every time without you doing anything.
How often interest is added (the compounding frequency) also matters. Monthly compounding grows a little faster than yearly, because each month's interest starts earning interest sooner.
Compound interest and investing in the UK
Compounding drives long-term investing in the UK. Whether you hold funds in a Stocks and Shares ISA, a Self-Invested Personal Pension (SIPP) or a workplace pension, your returns are reinvested to earn further returns.
The ISA allowance is £20,000 a year, and gains and income inside an ISA are tax-free, which makes it one of the best places for long-term compounding. Pension contributions also get tax relief, which adds to what you put in before compounding even starts.
Why regular contributions matter
Regular contributions are one of the biggest inputs in this calculator. Over a long enough period, even £100, £200 or £500 a month can outgrow the starting lump sum. That is why starting early and saving steadily tends to beat waiting to save a larger amount later.
It is also why pension auto-enrolment works: regular contributions from you and your employer make the most of compounding over a working life.
Compound interest compared with simple interest
Simple interest is only paid on the original amount: £10,000 at 5% simple interest earns £500 every year. Compound interest is paid on the growing total, so £10,000 at 5% compounded yearly becomes £10,500 after one year, then £11,025 after two, and so on. Over 20 years the difference is large.
Notes
- Returns are not guaranteed. This calculator assumes a fixed rate for the whole period.
- Real investment returns vary, and past performance is not a guide to future returns.
- This calculator does not allow for inflation, tax on gains, or platform fees.
- For Stocks and Shares ISA or pension projections with your own figures, use Saving Tool Advanced.
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