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Advanced Compounding Calculator
Model your wealth growth like a pro. This calculator simulates compounding with **any** mix of contribution frequency (weekly/bi-weekly/monthly/quarterly/annual) and compounding frequency (daily/weekly/monthly/quarterly/semi/annual) using a precise LCM timeline. It supports annual fees, tax on interest, and inflation-adjusted (real) returns. Instantly compare totals, interest earned, effective real value, and view a clean year-by-year breakdown. All calculations run in your browser—fast, private, and accurate.
Inputs
Results
Example Cards — Realistic Compounding Playbooks
Monthly Investor (Long-Term Index)
Before: $5,000 initial, $300 monthly, 7% APR, monthly compounding, 20 years, 0.10% fee.
After: Final balance grows steadily; interest eventually exceeds contributions after year 12.
Strategy: Dollar-cost averaging with low fees compounds powerfully; keep tax & costs low.
Weekly Saver (Aggressive)
Before: $1,000 initial, $75 weekly, 9% APR, weekly compounding, 10 years, 0.25% fee.
After: Faster contribution cadence lifts curve; weekly schedule tracks income cycles.
Tip: If cash flow allows, weekly beats monthly for earlier compounding on each deposit.
Quarterly Lump Sum (Tax-Aware)
Before: $20,000 initial, $2,500 quarterly, 6% APR, quarterly compounding, 15 years, 20% tax on interest.
After: Net interest is lower due to taxes; contributions dominate early years.
Guidance: Use tax-advantaged accounts to defer/avoid taxes and boost compounding.
Inflation Reality Check
Before: $15,000 initial, $400 monthly, 8% APR, monthly compounding, 25 years, 3% inflation.
After: Real value tag shows purchasing power; aim for real CAGR above 4% long term.
Note: Raise contributions 1–3% yearly to keep pace with inflation if possible.
About This Compounding Calculator
This tool uses a high-fidelity engine that aligns interest postings and cash-flows on a unified timeline built from the least common multiple of compounding and contribution frequencies. Each step applies interest, optional annuity-due timing, fee drag, and tax on the interest portion only. The result: realistic projections, clean yearly roll-ups, and actionable KPIs (final balance, total contributions, nominal/real returns, fees, taxes).
How to Use
- Enter principal, contribution amount, and choose contribution & compounding frequencies.
- Set APR, years, and optional fee, tax, and inflation assumptions.
- Select contribution timing (end vs. beginning of period).
- Results update instantly: review KPIs and the yearly table; download CSV for your records.
- Iterate with different settings to stress-test plans and compare scenarios.
FAQs
Do contributions compound immediately? If you choose “beginning of period”, each deposit earns one extra step of interest (annuity due).
How are fees modeled? Annual fee is pro-rated each step and deducted from the running balance, simulating ongoing management costs.
How are taxes modeled? Tax is applied to interest earned each step (an estimate). Real-world taxation can differ by account type and jurisdiction.
What’s “Real Value”? It discounts the final balance by cumulative inflation: Final ÷ (1 + inflation)years.
Why LCM? Using the least common multiple of posting frequencies yields consistent timing when schedules don’t match (e.g., weekly deposits, monthly compounding).
