Compound Interest Calculator
|Year||Beginning Balance||Contribution||Interest||Ending Balance|
The longer you save your money, the more you’ll receive in interest. That’s because interest compounds over time, which means a given month’s interest income is the result of applying your account’s rate of return to the sum of your underlying balance and the interest you received the month before (and the month before that, etc.). In order to use this saving strategy, however, one must be able to extend his or her investment time span. You’ll gain interest in the long run.
|Savings Comparison||Original Investment Time (5 years)||New Investment Time (6 years)|
Adding extra to your regular investment would increase your underlying balance faster since more money would accumulate before interest income. Having a higher balance sooner in turn increases your interest income, as your interest rate would apply to a larger amount and compounding would be boosted. In short, you’ll save a lot of money in the long run and get more out of your investment plan much sooner – if you can afford to scrimp now. But we know that adding extra to your monthly bills could be a big deal!
|Savings Comparison||Original Regular Investment||New Regular Investment|