Monthly Compound Interest Calculator

Calculate how your investments grow with monthly compounding and regular contributions. See the power of consistent monthly investing.

Investment Details
Monthly compounding
₹
₹

Added at the end of each month

8%
1%20%
10 years
1 year40 years
Total Months120
Monthly Rate0.667%

Final Balance

₹1,13,669

Total Interest

₹43,669

62.4% return

Total Invested

₹70,000

Principal + contributions

Growth Over Time
See how your investment grows year by year
Yearly Breakdown
Detailed year-by-year analysis
YearContributionsInterestTotal
1₹6,000₹1,055₹17,055
2₹12,000₹2,695₹24,695
3₹18,000₹4,970₹32,970
4₹24,000₹7,932₹41,932
5₹30,000₹11,637₹51,637
6₹36,000₹16,148₹62,148
7₹42,000₹21,531₹73,531
8₹48,000₹27,859₹85,859
9₹54,000₹35,210₹99,210
10₹60,000₹43,669₹1,13,669

What is Monthly Compound Interest?

Monthly compound interest is a method where interest is calculated and added to your principal balance every month. This means you earn interest on your interest 12 times per year, leading to faster growth compared to annual compounding.

When you make regular monthly contributions, the effect is even more powerful. Each contribution starts earning interest immediately, and that interest compounds monthly, creating exponential growth over time.

The Monthly Compound Interest Formula

A = P(1 + r/12)^(12t) + PMT × [((1 + r/12)^(12t) - 1) / (r/12)]
  • A = Final amount
  • P = Initial principal
  • r = Annual interest rate (decimal)
  • t = Number of years
  • PMT = Monthly contribution

Frequently Asked Questions

What is monthly compound interest?

Monthly compound interest means that interest is calculated and added to your principal balance every month. This results in earning interest on your interest, leading to exponential growth over time.

How is monthly compounding different from annual compounding?

With monthly compounding, interest is calculated 12 times per year instead of once. This means you earn interest on your interest more frequently, resulting in higher overall returns compared to annual compounding.

Should I make monthly contributions at the beginning or end of the month?

Contributing at the beginning of the month is slightly better because your money has more time to compound. However, the difference is usually small, so contribute whenever is most convenient for you.

What is a good monthly contribution amount?

A good monthly contribution depends on your income and financial goals. Financial experts often recommend saving 20% of your income. Start with what you can afford and increase it over time.