THE BTL REALITY TOOLKIT
Compound interest
calculator.
Small steps. A longer view. See how your money could grow with regular contributions and the power of compounding.
Make the numbers
work for your next move.
01
Your starting point
Your calculations run in your browser. No account or contact details required.
ILLUSTRATIVE VALUE IN 20 YEARS
Calculating…
Total contributed…
Compound growth…
In today's money…2.5% annual inflation
Watch time do its thing.
Year 20
Projected balanceYour contributions
| Year | Contributed | Growth | Balance | Today's money |
|---|
Your savings target
· Before tax and fees. Constant rate assumed. Actual returns can be lower or negative.
The cost of waiting 5 years
Same assumptions. Same finish date.UNDERSTAND THE NUMBERS
What is
compound interest?
Compound interest means earning interest on your original money and on the interest you have already earned. When you leave that interest in the pot, the next calculation starts from a bigger balance.
Put £1,000 into an account earning a constant 5% a year and it becomes £1,050 after one year. In year two, 5% is calculated on £1,050, giving you £1,102.50. That extra £2.50 is interest on your interest.
With investing, the same idea is often called compound growth. Reinvested returns can help your money build over time, but investments do not pay a steady, guaranteed rate and can fall in value.
Try your own numbers ↑Start with what you have.
Enter your current savings and a monthly contribution you could sustain. You can start from £0. Contributions matter, especially in the early years.
Challenge the assumptions.
Try a lower annual rate as well as your main scenario. Use the inflation setting to see the estimated spending power of your future balance.
Give the money a job.
Set a target for a deposit, a future project or a longer-term pot. The calculator shows the first month your projection reaches that cash amount.
THE MATHS, MADE SIMPLE
How compound interest is calculated
For a single deposit with no additional contributions:
A = P × (1 + r/n)nt
P is your starting amount, r is the nominal annual rate as a decimal, n is the number of compounding periods per year and t is the number of years. A is your projected balance.
How this calculator handles monthly saving
With an effective annual rate (AER), we use its equivalent monthly rate: (1 + AER)1/12 − 1. A nominal rate is converted using (1 + r/n)n/12 − 1.
We apply growth each month and add your contribution at the start or end, as selected. Contribution increases take effect after every 12 months. Daily compounding uses 365 periods per year. Fractional periods use an equivalent growth rate; a bank's actual crediting and rounding rules may differ.
“Today's money” divides each projected balance by (1 + inflation)years elapsed. The target remains a future cash amount. No taxes, fees or withdrawals are included, and figures are rounded for display only.
FROM A NUMBER TO A PLAN
Saving for your
first or next property?
A deposit is one part of the picture. You also need to plan for buying costs, a cash buffer and what you can afford to hold. Use this tool to explore the savings side, then build a plan around your own position.
Money you need soon has a different job from long-term investments. This calculator does not assess investment suitability, mortgage eligibility or property returns.
Explore Starter Club Talk through your next stepA FEW GOOD QUESTIONS
Compound interest
explained.
Is this a UK compound interest calculator?
Yes. Results are shown in pounds sterling and the calculator accepts an effective annual rate such as AER. The maths also works for an assumed investment return, but the tool does not calculate UK tax, allowances or product-specific charges.
Can I include monthly deposits?
Yes. Add a monthly contribution and choose whether it arrives at the start or end of each month. In the advanced settings, you can also increase that contribution by a fixed percentage each year.
What is the difference between AER and a nominal rate?
AER includes the effect of compounding over one year. A nominal annual rate does not. If your savings account quotes AER, keep the effective annual rate setting. If you enter a nominal rate, choose annual, quarterly, monthly or daily compounding.
What rate should I use?
For savings, you can enter the AER quoted by your provider, while remembering it may change. For an investment illustration, try several assumptions, including a lower or negative rate. The example rates here are not predictions, recommendations or guaranteed returns.
Does the calculator include inflation, fees and tax?
It shows a separate inflation-adjusted figure using the assumption you choose. The main balance is before inflation. Fees and taxes are not deducted; these can reduce the amount you actually keep.
Can I use it to plan a property deposit?
You can model how regular saving might build towards a cash target. Allow separately for transaction costs, an emergency buffer and any change in property prices. Reaching a savings target does not mean you will qualify for a mortgage.
Is the projected balance guaranteed?
No. This is a mathematical illustration using a constant rate. It does not model market volatility, rate changes, losses along the way or changes in your circumstances. Investments can fall in value and you may get back less than you put in.
Created by BTL Reality · Calculation method and worked examples checked September 2026.
Educational illustration only, not personal financial advice. Read our disclaimer. For more on the basics, see Investor.gov's compound interest resource.