Compound Interest & Savings Growth Calculator
See how a lump sum and regular monthly deposits grow at a given rate with daily, monthly or yearly compounding, year by year, in any currency.
| Total deposited | — |
|---|---|
| Interest / profit earned | — |
| Effective annual rate (APY) | — |
Year by year
In short
Compound interest grows a balance by A = P × (1 + r/n)^(n×t), with regular deposits added each period and compounding on top. The effective annual rate is (1 + r/n)^n − 1 — 8% compounded monthly is 8.30% a year — and money doubles in roughly 72 ÷ rate years.
Who this is for: Savers and investors in any currency projecting how a lump sum and monthly deposits grow over time.
How compound growth is calculated
With compounding, each period's interest is added to the balance and itself earns interest. For a lump sum: A = P × (1 + r/n)^(n×t), where r is the annual rate, n the compounding periods per year and t the years. Regular monthly deposits are added at the start of each month and then grow for the remaining time, which is why the calculator simulates month by month rather than using a single formula.
- APY / effective rate = (1 + r/n)^n − 1. An 8% rate compounded monthly is 8.30% a year; daily, 8.33%.
- Rule of 72: money doubles in roughly 72 ÷ rate years — 9 years at 8%, 6 years at 12%.
- Real value divides the final balance by (1 + inflation)^years to show purchasing power in today's money — important in Pakistan, where a 12% return against 7–10% inflation is a small real gain.
Bank savings accounts, term deposits, National Savings certificates, mutual funds and Islamic profit-sharing accounts can all be modelled here by entering the expected annual rate; for Islamic accounts the "interest" line is the expected profit.
See also: Zakat Calculator — Pakistan (Cash, Gold, Silver, Savings & Business).
Assumptions
- Month-by-month simulation: deposit added at the start of each month, growth applied at the chosen compounding frequency.
- APY = (1 + r/n)^n − 1; real value divides by (1 + inflation)^years.
- No tax, fees or rate changes are modelled.
Worked example
Deposits total PKR 70,000. The balance after 10 years is about PKR 114,300, so roughly PKR 44,300 is earned. At 7% inflation that balance is worth about PKR 58,000 in today's money — the nominal growth is largely inflation.
Frequently asked questions
Does it matter whether interest compounds daily or monthly?
Slightly: 8% compounded daily yields 8.33% a year versus 8.30% monthly. The rate itself and the time invested matter far more.
How do I model a term deposit that pays profit monthly to my account?
If the profit is paid out rather than reinvested, that is simple interest: use yearly compounding and treat the monthly payment as income, or enter a monthly deposit of the profit amount to simulate reinvesting it yourself.
Is the result guaranteed?
No. Fixed-rate deposits and savings certificates are predictable; funds and shares vary year to year, so the rate you enter is an average assumption.
Which currencies does it support?
Any — the currency field is a label only; the maths is the same.
How long does money take to double?
About 72 ÷ the annual rate in years: 9 years at 8%, 6 years at 12%.
What is the difference between APR and APY?
APR is the stated annual rate; APY includes the effect of compounding within the year and is always slightly higher.
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