Compound interest is the engine of wealth creation. Small amounts, left to grow, produce extraordinary results over time.
FVCompoundingGrowthRule of 72
Live Result
19,348.42
ฦ: PV * (1 + r)^nraw: 19348.4
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ฦ(x)
Use variable names from the panel above (e.g. FV, r, n) โ or type numbers directly: 10000 / (1 + 0.08)^10
PV
Present Value โ amount invested today
PV = 5000
r% as decimal
Annual interest/growth rate (decimal)
r = 0.07
n
Number of years
n = 20
๐ก You can also enter values directly in the formula: 10000 / (1 + 0.08)^10
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โฌ Export Calculation
Exports a plain .txt file with your expression, formula, all variable values, result, and educational notes โ ready to paste into any report, Word doc, Notion, or Google Docs.
The exported file includes the formula in standard mathematical notation โ you can paste it directly into Excel, Google Sheets, or back into FinanceSheep.
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Learn: How Much Will Your Money Grow?
Time Value of Money ยท Educational Guide
The Core Idea
Einstein reportedly called compound interest the eighth wonder of the world. $5,000 invested at 7% for 20 years becomes nearly $20,000 โ without adding another cent. The secret? You earn returns on your returns.
How It Works
Future Value = PV ร (1 + r)^n. Each year you earn interest on the original principal PLUS all accumulated interest. The exponent n makes this grow exponentially, not linearly.
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Real-World Example: $5,000 at 7% for 20 years: FV = 5,000 ร (1.07)^20 = 5,000 ร 3.869 = $19,348. Nearly 4ร your money just by waiting and letting compounding work.