Compound Interest Calculator: the strongest force in building wealth
Enter a lump-sum investment, an expected return, and a time horizon — and see how much of it is pure compound interest.
Simplified model with a fixed return, not investment advice. Actual returns fluctuate.
After 20 years you'd have roughly €38,697.
Assuming a return of 7% per year, before taxes and fees.
Final capital
€38,697.00
Contributed
€10,000.00
Interest earned
€28,697.00
What does this mean for your real wealth?
“After 20 years you'd have roughly €38,697.” — that holds for the assumptions above. Whether it looks the same with your real portfolio and your real numbers, you can see in Planafolio — for free.
Save the result in your financial planWhat does the result mean?
The result shows how an amount grows when returns earn returns again every year. The longer the period, the larger the part that comes purely from interest on interest.
Model assumptions
- The return stays constant for the whole period. Real markets fluctuate; losing years are not part of the model.
- The model runs month by month: capital grows at the equivalent monthly rate, and the contribution is added at the end of each month.
- Taxes on returns (German flat tax, advance lump sum) are not deducted.
- Fund costs, order fees and spreads are not deducted.
- All amounts are nominal. Purchasing power falls with inflation, which the result does not reflect.
How the calculator works
The annual rate is converted into an equivalent monthly rate; capital grows month by month, and optional contributions are added at the end of each month.
More on the methodologyWorked example
Example: lump sum without further deposits
Worked example using the calculator's default values above: a one-off amount, no further contributions, all returns stay invested. The period is split into two halves.
Inputs
- Lump sum€10,000
- Annual return (assumption)7%
- Duration20 years
Calculation
| Portfolio value after 10 years | €19,672 |
|---|---|
| Growth in the first 10 years | €9,672 |
| Growth in the following 10 years | €19,025 |
Result
| Final balance | €38,697 |
|---|---|
| Of which returns | €28,697 |
At the same return, the second half adds €19,025 instead of €9,672: the returns of the early years earn returns of their own. That is the compound interest effect.
The 7% annual return is an assumption, the same default as in the calculator above, not a forecast. Costs and taxes are not deducted.
Sources and status
Content reviewed on September 29, 2026.
- § 20 EStG – Einkünfte aus Kapitalvermögen (im Rechner nicht versteuert)
- § 18 InvStG – Vorabpauschale (im Rechner nicht berücksichtigt)
- Statistisches Bundesamt – Verbraucherpreisindex für Deutschland
The calculation is a simplified model under the stated assumptions and is not investment or tax advice.
What can I do?
Try different periods and returns to see which lever matters more in your case – then build the result into your financial plan.
How it works
Understanding compound interest
Why a lump sum grows so strongly over time.
The formula behind it
Capital × (1 + return)^years — every year, not just the starting capital but also the gains already earned get compounded.
Lump sum vs. savings plan
With a lump sum, the entire capital works from day one — the savings plan calculator shows the effect of adding a monthly contribution on top.
The time factor
Compounding accelerates exponentially over time — the last years of a long horizon often contribute the most.
Frequently asked
Questions about the compound interest calculator
Compound interest means gains aren't paid out but reinvested and earn further gains themselves — so capital grows faster over time than with simple interest.
Both use the same underlying math — this calculator emphasizes a lump sum, the savings plan calculator a recurring monthly contribution. You can adjust either figure in both.
The calculator assumes a constant annual return and doesn't account for taxes, fees, or market swings — it's a rough guide, not financial advice.
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