Monthly Interest Calculator
Calculate interest that compounds monthly. Enter the principal, annual interest rate, and number of months to see the growth in balance over time.
Recommended Settings
Pro Tips
- •This calculates interest that compounds monthly - each month's interest is calculated on the growing balance, including previously earned interest
- •The monthly rate is the annual rate divided by 12 - a 6% annual rate becomes a 0.5% monthly rate
- •Over longer periods, monthly compounding produces meaningfully more growth than simple interest at the same annual rate
- •This models a single lump-sum deposit - it doesn't account for additional contributions made during the period
Most Popular
Most users project balance growth over 12, 24, or 60 months to compare savings or investment scenarios
When to Use This Tool
Estimate how a lump-sum deposit will grow over time with monthly compounding.
Understand how interest accrues on a loan balance that compounds monthly.
Compare the growth of different interest rates over various time horizons.
See how monthly compounding differs from simple interest over the same period.
How It Works
Divide the annual interest rate by 12 to get the monthly interest rate
Apply the compound interest formula, raising (1 + monthly rate) to the power of the number of months, and multiply by the principal
Subtract the principal from the final balance to find the total interest earned
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Frequently Asked Questions
Does this account for additional monthly deposits?
No, this calculates growth on a single lump-sum principal only. For a projection that includes recurring monthly contributions, use the Savings Goal Calculator instead.
What's the difference between the monthly rate and the annual rate?
The monthly rate is simply the annual rate divided by 12. Because interest compounds each month, the effective annual growth is slightly higher than the stated annual rate when compounding monthly rather than annually.
Is my data sent to a server?
No. All calculations happen instantly in your browser using JavaScript. Nothing you enter is transmitted anywhere.
How is this different from the Daily Interest Calculator?
This tool compounds interest monthly over multiple months, useful for modeling growth over a year or more. The Daily Interest Calculator instead uses simple (non-compounding) interest, better suited for short, specific day counts.
Can I use this for a loan payoff estimate?
This shows how a balance would grow if interest compounds and nothing is paid down. For a loan you're actively paying off, the actual balance would decrease based on your payment schedule, which this tool doesn't model.