Monthly compounding

Monthly Compound Interest Calculator

Use the main calculator with monthly compounding when deposits happen every month and the account credits interest monthly.

Best for

Savings accounts, contribution plans, and spreadsheet checks where the monthly deposit is the same each month.

monthlyRate = annualRate / 12
balance = balance * (1 + monthlyRate) + monthlyDeposit

This simple version assumes deposits are made at month end. For a full chart, use the homepage calculator and select monthly compounding.

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Decision guide

Match monthly compounding to monthly planning

Monthly compounding is convenient for budgets because deposits, statements, and goal reviews often happen monthly. The math divides the nominal annual rate by 12 and applies it over the number of months. Confirm whether an actual account compounds monthly, credits monthly, or merely reports a monthly statement.

$5,000 at 4.8% for three years

A constant 4.8% nominal rate compounded monthly gives 5,000 x (1 + 0.048/12)^36, or about $5,772 before fees and taxes. Adding a recurring deposit requires an annuity term or month-by-month calculation; it should not be folded into the starting principal.

Before you decide

  • Convert years to total months.
  • Use the nominal rate only when it is actually provided.
  • Place recurring deposits at start or end consistently.
  • Compare the result with the disclosed APY.

Method and limitations

This is a deterministic projection. It does not predict a future savings rate or investment return. CFPB rules make APY a standardized deposit-account comparison measure; the bank's disclosure should control when your reconstructed monthly result differs because of tiering, timing, or special terms.