*Disclaimer: Usage of this tool does not constitute financial advice and should be used only for educational or entertainment purposes.  Please seek advice from a professional financial advisor before making any important financial decisions.

The compound interest calculations in this tool are accurate based on the standard compound interest formula:

A=P×(1+r/n)ntA = P \times (1 + r/n)^{nt}A=P×(1+r/n)nt

Where:

• $A$ = Final Amount
• $P$ = Principal (monthly contributions)
• $r$ = Annual Interest Rate (10% or 0.10)
• $n$ = Compounding frequency (monthly = 12 times a year)
• $t$ = Time in years

How This Tool Works:

1. Each month, the new contribution is added, and the balance is compounded.
2. The total interest earned is calculated by subtracting the user’s contributions from the final total.
3. The chart updates dynamically to show the difference between:
   • The total amount (with interest)
   • The amount the user actually invested (simple sum of contributions)

How to Verify Accuracy?

You can manually verify with an online compound interest calculator (e.g., Investor.gov Compound Interest Calculator) by:

• Setting monthly contributions
• Setting 10% annual interest
• Setting monthly compounding

This tool should match the results you get from reputable sources. ✅

📌 Potential Edge Cases

• Floating-point rounding: JavaScript may round numbers slightly differently than financial calculators.
• Different compounding frequency: This tool compounds monthly (12 times a year). If another calculator uses daily compounding, you may see slight variations.
• Shorter timeframes (1-2 years): For short periods, differences in compounding methods may show small deviations.

🔍 Bottom Line:

✅ The math is correct for monthly compounding at 10% (S&P 500 assumption) per year.
✅ It matches financial formulas used in banks & investment calculators.
✅ Minor variations may appear due to rounding, but nothing significant.