The Formula
A = P (1 + r/n)nt + PMT \* [((1 + r/n)nt − 1) / (r/n)]
A = Future value, P = Principal, PMT = periodic deposit, r = annual rate, n = compounds per year, t = years.
Master the Power of Compound Interest
Albert Einstein allegedly called compound interest “the eighth wonder of the world.” Whether he did or didn’t, the math is magical: your money earns returns, and those returns earn returns—snowballing into serious wealth. Use the quick guide below, then crunch your own numbers with NXT King’s interactive calculator.
Rule of 72
Estimate how long it takes to double your money: just divide 72 by your annual interest rate. At 8 % you’ll double roughly every 9 years.
Inflation Check
Real wealth grows when your after‑tax, after‑fee return beats inflation. Keep an eye on CPI numbers or TIPS yields as your hurdle rate.
Compound Interest Calculator
Frequently Asked Questions
• How often should I contribute?
Consistency beats intensity—automate monthly deposits so you’re dollar‑cost averaging no matter what the market does.
• What rate should I use?
Historically, U.S. equities have returned ~7–10 % after inflation. Real estate or private credit may differ. Use conservative numbers to avoid disappointment.
• Where can I grow tax‑advantaged?
401(k)s, Roth IRAs, HSAs, Solo 401(k)s, Cash‑value life—each shelters growth differently. Talk with us about the right wrapper.
This tool is for illustrative purposes only and does not constitute financial advice. Actual results depend on market conditions, taxes, fees, and your personal situation.