Compound Interest CalculatorCompound Interest Calculator

It is a situation in which the gains you have accumulated are added to the money you have already invested and begin generating additional gains themselves. Therefore, growth can accelerate over time: you earn not only on your contributions, but also on gains accumulated in the past.

The term “compound interest” is sometimes used broadly to describe the accumulation effect. In a deposit, it is indeed interest. In capital market investments, the more precise term is cumulative return or “return on return.” The mathematical principle is similar: the gain remains invested and begins generating an additional gain.

It is impossible to know in advance what an investment’s future return will be. You can run several simulations using different assumptions—for example, low, medium, and high returns—and see how each one affects the outcome. It is better to think of the calculator as a tool for examining scenarios, rather than a tool for predicting the future.

No. If an investment generated an average return of 7% over a long period, that does not mean it rose by 7% every year. In one year it may rise more, in another less, or even decline. The calculator assumes a fixed average return only to enable a simple and clear simulation.

They can provide context, but they do not guarantee anything about the future. Therefore, it is recommended to examine several scenarios and not base an entire financial plan on a single rate of return.

Both are important. A higher contribution naturally increases the accumulated amount, but time has a special role because of the compound interest effect. The longer the money remains invested, the more time the gains have to generate additional gains. Try changing only the number of years in the calculator and see the difference.

Absolutely. When you contribute consistently for years, the new contributions also join the amount and begin accumulating returns. The calculator lets you see the difference between a one-time investment and a combination of an initial amount and regular contributions.

Because management fees are charged over time and reduce the amount that remains invested. When the amount is smaller, future gains are also calculated on a smaller base. Therefore, even a difference in management fees that appears small can become significant over a long period.

The future amount is the number of shekels you will have according to the simulation. The amount in today’s terms tries to answer a different question: what will the purchasing power of that money be relative to today’s prices? If prices rise over the years due to inflation, the same amount of money will be able to buy less in the future.

No. The calculator is a simulation based on the assumptions you entered. In practice, returns, inflation, management fees, taxes, and even the amount of your contributions may change over the years. The goal is not to predict exactly how much money you will have, but to help you understand how time, returns, and regular contributions can affect your savings.