Compound Interest Calculator

Use the formula FV = P·(1+i)^n + PMT·((1+i)^n − 1)/i: initial capital P, monthly contribution PMT, annual rate divided by 12 (i) and number of months (n). In practice, just enter the initial amount, the monthly contribution, the rate and the term in the calculator and you get the final value and the interest earned, year by year.

Simple interest is always earned only on the initial capital; compound interest is also earned on accumulated interest, so it grows faster over time. At 5% a year, €1,000 always earns €50/year in simple interest; with compounding, the interest in year 10 is already earned on a much larger balance.

A shortcut to estimate how many years money takes to double with compound interest: divide 72 by the annual rate as a percentage. At 6% a year, capital doubles in about 12 years; at 4%, in 18; at 8%, in 9. It is a useful approximation for comparing scenarios quickly.

It depends on the rate and the term. At 4% a year with monthly compounding and no top-ups, €10,000 becomes about €14,908 in 10 years and about €22,226 in 20 years, before taxes. You can simulate your own amount, rate and term in the calculator.

This calculator uses monthly compounding, common in savings and investment products. The more frequent the compounding (annual, monthly, daily), the larger the effect, although the gap between monthly and annual is modest next to the impact of time and the rate.

In term deposits that capitalise interest, in Portuguese savings certificates (Certificados de Aforro), in PPR retirement plans and in accumulating funds and ETFs, which reinvest their income. Also in debt, but against you: unpaid credit-card interest is added to the balance and accrues interest itself.

Yes, 28% in both cases, but not at the same moment. On a term deposit or Portuguese savings certificates the interest is capital income and suffers withholding at source as a final settlement, at the flat 28% rate of article 71(1)(a) of the CIRS, every time it is credited. In an accumulating fund or ETF nothing is withheld along the way: the tax only appears on redemption, as a capital gain taxed at the 28% autonomous rate (articles 10(1)(b)(5) and 72(1)(c)). The calculator shows both results side by side.

In final-value terms, deferring always wins, and the gap widens with the horizon. With €1,000 to start and €100 per month at 5%, deferring the tax is worth about €155 over 10 years and about €5,895 over 30. The surprising detail is that the saver taxed every year pays less tax in euros (about €11,902 against €14,194 over 30 years) and still ends up with less money, because tax withheld early stops earning interest. This compares tax mechanics, not products: risk, cost and liquidity differ, and none of this is advice.

Considerably less than the nominal figure suggests. The calculator divides the final value by (1 + inflation) to the power of the number of years and shows today's purchasing power. In the 10-year example, €15,851 net at 2% inflation is worth about €13,003 today, against €13,000 contributed. That is why it pays to use a prudent interest rate and to look at the real value.

Yes: set the tax field to 0% and the two net figures collapse onto the gross value. A Portuguese PPR has its own rules on redemption and a tax benefit on contributions, which the PPR calculator handles; here all that matters is that the product does not withhold tax on the interest year by year.

You lose the most valuable compounding cycles. With €100 per month at 5% a year, 25 years of contributions build about €59,551; starting 5 years later (20 years), about €41,103. You contribute €6,000 less, but end with €18,400 less.

No. It is an educational estimate using a fixed rate. Real returns vary and this is not financial advice.