Calculate savings growth and cumulative interest earned from an initial deposit at a fixed annual rate. Choose how often interest compounds and see the ending balance separately from the original principal. This version models a single deposit with no later contributions or withdrawals.
Your interest schedule
| Year | Savings balance | Cumulative interest |
|---|
Worked example: annual compounding
The SEC Investor.gov classroom example starts with $100 and a 5% annual rate. It shows the balance after the second year. This is an educational example, not an available savings rate. With annual compounding and no additional deposits, the following outputs follow the standard formula above.
| Initial deposit | Ending balance | Interest earned |
|---|---|---|
| $100.00 | $110.25 | $10.25 |
How it works
Ending balance = P * (1 + r / m)^(m * t)
Cumulative interest earned = ending balance - P
P is the initial deposit, r is the annual decimal rate, m is compounding periods per year, and t is years. This is the standard periodic compounding formula: multiply the balance by (1 + r / m) each period. The SEC classroom example illustrates annual compounding by applying the rate to principal and prior interest. The displayed formula repeats that same operation for the selected number of periods. SEC Investor.gov defines compound interest as interest on principal and accumulated interest. Its compound interest calculator also distinguishes the interest rate from compounding frequency.
Keep deposits separate from interest
The original principal is money you supply. Cumulative interest is the modeled growth above that principal. The ending balance includes both. This distinction matters because a larger balance does not always mean a larger amount of interest; additional deposits would also raise an account balance. This calculator excludes those deposits so that the growth of the initial amount remains clear.
The annual table shows the balance after each complete modeled year. Its interest column is cumulative: each row includes all interest since the starting deposit. To find the interest earned in just one later year, subtract the preceding row's cumulative interest from the current row. Do not add the cumulative column down the table, since that would count earlier earnings more than once.
Choose the rate and compounding frequency
The annual rate input is a nominal annual rate, not an annual percentage yield already adjusted for compounding. The model divides this rate by the selected frequency and compounds the resulting periodic rate. Entering an annual percentage yield as a nominal rate and then applying frequent compounding would describe a different growth assumption. Check how your account presents its rate before using it here. The Federal Reserve Truth in Savings guidance defines APY using both the interest rate and compounding frequency.
Annual, quarterly, monthly, and daily choices determine the number of modeled compounding periods. The daily option uses a fixed day-count basis shown in the selection. A real account may use a different accrual or posting convention. The SEC's Investor.gov tool asks separately for a rate and compounding frequency, which is the distinction this tool preserves.
What the projection can tell you
Change only the time input to inspect how the same deposit and fixed rate grow over a different horizon. Change only the compounding frequency to compare periodic assumptions. These are calculations under inputs you choose. They do not establish that an account will keep its rate or that an investment will deliver the entered return.
The tool does not subtract inflation, taxes, account fees, or investment expenses. It also does not model varying returns or market losses. The displayed ending balance is therefore a nominal mathematical value under a fixed positive or zero rate. Use it to understand the formula and to compare assumptions, rather than to treat an illustration as a guaranteed future balance.
Loan interest paid and savings interest earned answer different questions. For sums across loan payment periods, use the cumulative interest calculator. For borrowing cost across a full fixed-rate schedule, use total loan interest. Keep those repayment calculations separate from this deposit-growth model when organizing your results.
Frequently asked questions
Does this include monthly deposits?
No. This tool follows a single initial deposit so that cumulative interest equals ending balance minus starting principal.
Should I enter APY as the annual rate?
The field uses a nominal annual rate before compounding. An APY already reflects a compounding assumption and should not be treated as the same input.
Sources
- SEC Investor.gov: compound interest definition
- SEC Investor.gov: compound interest calculator
- SEC Investor.gov: classroom example and compounding method
- Federal Reserve: APY and interest rate definitions
Data as of 2026-10-05. Source examples and formula documentation only; no live market rates.