Short answer
This calculator estimates how a starting balance and regular contributions grow at one constant nominal annual rate. Contributions are assumed to arrive at the end of each selected month or year.
It is a scenario, not a savings-account quote or investment forecast. Actual rates, bonus conditions, fees, tax, inflation, contribution dates and interest-crediting rules can change the outcome.
Formula and contribution timing
The starting principal uses the standard compound-interest identity:
Principal value = P x (1 + r/n)^(n x t)
Here, P is the starting balance, r is the nominal annual rate as a decimal, n is the number of compounding periods per year and t is the number of years.
Regular contributions use an end-of-period annuity calculation. Because contribution frequency can differ from compounding frequency, the calculator first converts the nominal rate to an effective rate for each contribution period:
i = (1 + r/n)^(n/c) - 1
Contribution value = PMT x ((1 + i)^m - 1) / i
Here, c is the number of contributions per year, m is c multiplied by the number of years, and PMT is the amount deposited at the end of each contribution period. When the entered rate is zero, the calculator simply adds the contributions.
Worked example
Start with $10,000, use a constant nominal rate of 7% compounded monthly for 10 years, and add $200 at the end of each month.
- Starting balance after compounding: about $20,096.61
- Total regular contributions: $24,000
- Value of the regular contributions at year 10: about $34,616.96
- Estimated final balance: $54,713.58
- Estimated interest: $20,713.58
If the same $200 is added only once at the end of each year, total contributions are $2,000 and the estimated final balance is $22,889.97. That is why the displayed formula must use the selected contribution frequency rather than assume every contribution is monthly.
What the result leaves out
The model does not include:
- changing or introductory interest rates;
- savings-account bonus conditions;
- investment gains or losses;
- fees, tax or inflation;
- deposits made at the start or middle of a period; or
- product-specific day-count and crediting conventions.
The chart separates the original principal, cash contributed and calculated interest. It does not show today's purchasing power. Use the Inflation Calculator for a separate constant-inflation scenario and the Simple Interest Calculator when interest is not added to the balance.
Source and disclaimer
ASIC Moneysmart's compound interest guide explains interest on principal and previously earned interest. Its compound interest calculator states that regular deposits are modelled at the end of the selected deposit period. Sources checked 7 September 2026.
General information only. Results are estimates based on the assumptions entered. They are not a product quote, guaranteed return, investment recommendation or financial advice.
