Compound Interest Calculator
Maturity Amount
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Principal
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Interest Earned
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Year-over-Year Growth
Year-by-Year Breakdown
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What is the Compound Interest Calculator?
The Compound Interest Calculator is a free online financial tool that helps you estimate the growth of your investments or savings over time using the power of compounding. Compound interest means you earn interest not just on your original principal but also on the interest that accumulates over each period. This snowball effect makes compound interest one of the most powerful forces in personal finance and investing. Whether you are planning a fixed deposit, evaluating a long-term savings goal, comparing investment options, or understanding how debt compounds on unpaid balances, this calculator gives you instant results. It supports multiple compounding frequencies — daily, monthly, quarterly, semi-annual, and annual — to match different financial products available in India.
How to Use the Compound Interest Calculator
- 1. Enter the principal amount — the initial investment or deposit.
- 2. Enter the annual interest rate (in percentage).
- 3. Enter the time period in years.
- 4. Select the compounding frequency (annually, semi-annually, quarterly, monthly, or daily).
- 5. View the maturity amount, compound interest earned, and year-by-year growth table instantly.
Formula Used
Where P = Principal, r = Annual interest rate (decimal), n = Compounding frequency per year (1 = annual, 12 = monthly, 365 = daily), t = Time in years, A = Maturity amount, CI = Compound Interest earned.
Practical Example
Invest ₹1,00,000 at 10% per annum compounded annually for 5 years: A = 1,00,000 × (1 + 0.10/1)^(1×5) = 1,00,000 × (1.10)^5 = 1,00,000 × 1.61051 = ₹1,61,051. Compound Interest = ₹1,61,051 - ₹1,00,000 = ₹61,051. Compare this to simple interest which would yield only ₹50,000 interest on the same investment — a difference of ₹11,051 in just 5 years, which grows much larger over longer periods.
Why Use Our Compound Interest Calculator?
- • Supports all compounding frequencies — annual, semi-annual, quarterly, monthly, and daily.
- • Year-by-year growth table shows your investment value at the end of each year.
- • Visual chart compares principal vs. interest growth for easy understanding.
- • Free, instant results with no login or download required on any device.
Frequently Asked Questions
What is compound interest?
Compound interest is interest calculated on both the initial principal and the accumulated interest from previous periods. Unlike simple interest (which only accrues on the principal), compound interest grows exponentially. It is the basis for how FDs, mutual funds, and other long-term investments grow over time.
How is compound interest different from simple interest?
Simple interest = Principal × Rate × Time / 100, calculated only on the original principal. Compound interest reinvests the earned interest, so you earn returns on your returns. Example: ₹1,00,000 at 10% for 5 years — SI gives ₹50,000; CI gives ₹61,051. Over 20 years the difference becomes enormous.
What does compounding frequency mean?
Compounding frequency is how often interest is calculated and added to your principal each year — annually (1), semi-annually (2), quarterly (4), monthly (12), or daily (365). Higher frequency means slightly more returns. Monthly compounding on an FD at 7% gives slightly more than annual compounding at 7%.
How does the Rule of 72 relate to compound interest?
The Rule of 72 estimates how many years it takes to double your money at compound interest. Simply divide 72 by the annual interest rate. At 8% rate: 72 / 8 = 9 years to double. At 12%: 72 / 12 = 6 years. It is a quick mental math shortcut useful for comparing investment options.