All calculations run in your browser. No login required. · Updated for AY 2026-27
🇮🇳 India
🇮🇳 India · INR 🇺🇸 USA · USD Soon 🇨🇦 Canada · CAD Soon 🇦🇺 Australia · AUD

Compound Interest Calculator Australia — Savings & Investment Growth 2026

Last updated: Reviewed by Sarah Mitchell, CFA
**Compound interest** is the engine behind long-term wealth creation. In Australia, high-interest savings accounts offer approximately 4.8–5.1% (May 2026), term deposits approximately 4.3–4.8% for 12-month terms, and a diversified share portfolio has historically returned approximately 9–10% annually (including dividends and franking credits). This calculator handles any combination of initial deposit, regular contributions, and compounding frequency — weekly, fortnightly, monthly, quarterly, or annually. Enter an interest rate to see your final balance and total interest earned.
Compound Interest Calculator Australia
Lump sum deposited at the start
Amount added each period
Term deposit ~4.5%; high-interest savings ~4.8%; shares ~8–10% historically
Final Value —
Total Contributed —
Interest Earned —
Effective Annual Return (EAR) —
View Year-by-Year Breakdown
Year-by-year growth breakdown

Real-World Examples — 2026

$10,000 starting + $500/month for 10 years at 4.5%

With $10,000 initial deposit and $500/month additional contributions at 4.5% annual interest (monthly compounding) for 10 years: final value approximately $91,100. Total contributed: $70,000 ($10,000 initial + $60,000 contributions). Interest earned: approximately $21,100.

$50,000 starting, no contributions, 20 years at 7% (shares)

Investing $50,000 in a diversified Australian share portfolio returning 7% annually (no additional contributions) for 20 years: final value approximately $193,500. Purely through compounding, the initial $50,000 grows nearly 4x. This illustrates the power of long-term compounding even without adding more capital.

Frequently Asked Questions

As of May 2026, the highest savings account rates in Australia range from approximately 4.8–5.2% (base + bonus interest) from banks including ING, Macquarie, Ubank, and Up Bank, subject to monthly conditions. The RBA cash rate at 4.10% sets a floor for most high-interest accounts. Compare rates on comparison sites as rates change frequently.

Compound interest is calculated using the formula: A = P × (1 + r/n)^(nt), where A is the final amount, P is the principal, r is the annual rate (decimal), n is the number of compounding periods per year, and t is the time in years. For regular contributions, each contribution is compounded separately from the time it is made.

Yes. Interest earned on savings accounts and term deposits in Australia is assessable income, included in your tax return and taxed at your marginal rate. Your bank reports interest payments to the ATO automatically. To minimise tax on savings, higher-income earners should compare after-tax returns from savings accounts vs dividend-paying shares (with franking credits) or tax-advantaged options like super.

The nominal rate is the stated annual interest rate. The effective annual rate (EAR) accounts for the effect of compounding within the year. For example, a 4.8% nominal rate compounded monthly has an EAR of approximately 4.91%. The EAR is the true annual return you earn and is the correct basis for comparing accounts with different compounding frequencies.

Term deposits offer a fixed, guaranteed rate for a set period (typically 1 month to 5 years) and are APRA-guaranteed up to $250,000 per bank. High-interest savings accounts offer variable rates (with conditions) and instant access. In a rising rate environment, savings accounts let you benefit from rate increases; in a falling rate environment, locking in a term deposit is advantageous. Current 1-year term deposit rates of approximately 4.5% are competitive with savings account bonus rates.