How the compound interest calculator works
Last updated 9 November 2026
Compound interest means you earn interest on your interest. When interest is added to your balance, the next round of interest is worked out on the bigger amount. The longer the money stays invested, the faster it grows.
The calculator steps through your savings month by month. It starts with your starting amount, adds your monthly contribution at the end of each month, and adds interest at the rate you choose. If you pick monthly compounding, interest is added every month at a twelfth of the yearly rate. If you pick annual compounding, interest is added once a year, and money you added during the year earns interest only for the months it was there.
If you set a yearly increase, your monthly contribution goes up by that percentage every 12 months. The result shows how much you put in, how much interest you earned, and the final balance. Turn on “today’s money” to see what that balance would buy at today’s prices.
Worked example
Say you start with R 10 000 and add R 1 000 a month for 10 years, at 9% a year with monthly compounding. These are the calculator’s starting values.
- You put in R 10 000 up front and R 120 000 in monthly contributions, R 130 000 in total.
- In the first year you earn R 1 446 in interest. By the last year, the interest is R 18 133, because it is worked out on a much bigger balance.
- After 10 years your balance is R 218 028, of which R 88 028 is interest.
- Keep going for 20 years instead and the balance grows to R 727 978. The interest alone is then R 477 978.
If you raised your contribution by 5% every year, the 10-year balance would be R 259 340. At 4.5% inflation, the original R 218 028 would buy about what R 140 394 buys today.
What the figures mean
- Value is the balance at the end of the period, before tax and fees.
- Total contributions is everything you add after the starting amount.
- Interest earned is the balance less everything you put in. It is the reward for leaving the money invested.
- Monthly or annual compounding changes how often interest is added. At the same quoted rate, monthly compounding grows slightly faster.
- Today’s money divides the future balance by inflation over the period, so you can compare it with prices now.
Things to watch
- Returns are not guaranteed. Investments that hold shares go up and down, and some years can be negative. The calculator uses a steady rate to show the effect of compounding.
- Fees reduce your return every year, so their effect compounds too. A fee of 1% a year takes a large bite over decades.
- Interest is taxable above R 23 800 a year for under-65s (R 34 500 from 65). Growth in a tax-free savings account is not taxed. See the TFSA calculator.
- Inflation means a rand buys less every year. A return below inflation loses buying power even though the balance goes up.
- Starting early matters more than the exact rate. Time gives compounding room to work.
If you are saving for something specific, the savings goal calculator works out the monthly amount you need.
Sources
The calculator uses standard compound interest maths with your own inputs. The interest exemption amounts come from the Budget 2026 changes. All figures were last checked on 9 November 2026, and the full list of sources is at the bottom of this page.