Compound Interest Calculator UK
Project how your savings grow with compound interest. Enter a starting amount, monthly contribution, annual rate and years to see the final value and interest earned.
Last updated 21 June 2026 · Written and reviewed by Mustafa Bilgic
Compound interest calculator
Starting amount + monthly saving.
Estimate only — figures use the latest published UK rates. Always confirm on GOV.UK.
What is compound interest?
Compound interest is interest earned on your original money plus all the interest it has already earned. Because each year's interest joins the pot and earns interest itself, savings grow faster and faster over time — Einstein supposedly called it the eighth wonder of the world. Add a regular monthly contribution and the effect is even more powerful, which is why starting early matters so much.
Start with £5,000, add £200 a month at 5% a year for 10 years and you end up with about £39,300 — of which roughly £10,300 is interest you never paid in.
How compounding builds wealth
This calculator compounds monthly: each month it adds growth at one-twelfth of your annual rate, then adds your contribution. Over a long period the interest-on-interest effect dominates — the final years grow the pot by far more than the early ones, even though the contribution is the same. That is why the best time to start saving or investing is always as early as possible.
The power of starting early
| £200/month at 5% | Final value |
|---|---|
| After 10 years | ~£31,200 |
| After 20 years | ~£82,800 |
| After 30 years | ~£167,000 |
Illustration assumes a 5% annual return compounded monthly, ignoring tax and charges.
Savings, investments and tax
Compounding works for cash savings and for investments, though investment returns rise and fall rather than being fixed. Sheltering your money in an ISA or pension means the growth is not eaten into by tax. To see the interest on a fixed cash balance, use our savings interest calculator, and check how inflation erodes value with our inflation calculator. The MoneyHelper service explains saving and investing in plain English.
Frequently asked questions
What is compound interest?
Compound interest is interest earned on both your original money and the interest it has already earned. Because the interest joins the pot and earns more interest, savings grow faster the longer you leave them.
How is compound interest calculated?
Each period, interest is added to the balance, and the next period's interest is calculated on the new, larger balance. This calculator compounds monthly and adds your regular contribution, then repeats for the number of years you set.
Why is starting early so important?
Because compounding builds on itself, the early years lay the foundation for much larger growth later. Starting ten years sooner can more than double the final amount, even with the same monthly contribution.
Does this account for tax and charges?
No. This is an illustration of gross growth at a fixed rate. Real returns are reduced by tax and any charges, unless your money is in a tax-free wrapper like an ISA or pension.
What is a realistic growth rate?
Cash savings might return 3–5% depending on rates. Long-term stock-market investments have historically returned around 5–7% a year after inflation, but they go up and down and are not guaranteed.