Grow a lump sum plus regular contributions with compounding.
Future value
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Total contributions
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Interest earned
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Your breakdown
Updates live as you type
Item
Amount
Worked example
Start with a principal of KES 100,000, add KES 10,000 every month, and assume a 10% annual return compounded monthly for 10 years. The monthly rate is 10% divided by 12, about 0.8333%, over 120 months. The starting principal grows to roughly KES 270,704, and the stream of monthly contributions grows to roughly KES 2,048,450. Adding the two gives a future value of about KES 2,319,154.
Item
Amount (KES)
Starting principal
100,000
Contributions (10,000 x 120)
1,200,000
Total put in
1,300,000
Interest earned
1,019,154
Future value
2,319,154
You put in KES 1,300,000 over the decade and compounding adds another KES 1,019,154, so interest is nearly as large as everything you contributed. The chart splits the future value into money put in and interest earned.
How it is calculated
Compound interest pays a return on both the original capital and on interest already credited, so growth accelerates over time. The tool computes two parts and adds them. The lump sum grows by the future-value factor, which is (1 plus the periodic rate) raised to the number of periods. The regular contributions grow as an annuity, the periodic payment times the quantity (1 plus the periodic rate) raised to the periods, minus one, all divided by the periodic rate. The periodic rate is the annual rate divided by the compounding frequency, and the number of periods is the years times that frequency. More frequent compounding lifts the result slightly for the same headline rate, because interest is credited and starts earning sooner. The figures shown are gross of tax. In Kenya, interest from banks and most funds is subject to 15% withholding tax, so a net projection would be a little lower.
Frequently asked questions
How does compound interest grow savings in Kenya?
Compounding means you earn interest on both your original money and the interest already added. The future value is the principal grown at the periodic rate, plus the future value of each contribution. More frequent compounding gives a slightly higher result for the same annual rate. This tool shows gross growth before any withholding tax on interest.
Does Kenya tax interest income from savings accounts?
Yes. The Kenya Revenue Authority applies a 15% withholding tax on interest earned from bank deposits, money market funds, and most fixed-income instruments. The tax is deducted at source by the paying institution. This calculator shows the gross figure, so multiply interest earned by 0.85 to estimate what you actually keep.
Which accounts in Kenya offer compound interest?
Fixed deposit accounts, money market funds, and Sacco fixed deposits all compound interest, usually monthly or quarterly. Most commercial banks also compound interest on savings accounts monthly. Treasury bills and bonds pay simple interest at maturity, so they do not benefit from within-period compounding the same way.
How does inflation affect compound growth in Kenya?
Kenya has historically seen inflation between 5% and 10% a year. If your account earns 10% gross and inflation runs at 7%, your real purchasing-power gain is roughly 3% per year before withholding tax. For a true inflation-adjusted projection, use the Real Return After Inflation calculator linked below.