Compound Interest Calculator
Compounding is the eighth wonder of the world. Enter your initial investment, expected rate, and time horizon to see what your money becomes, and how much of that is pure interest.
Frequently Asked Questions
What is the difference between simple interest and compound interest?+
Simple interest is calculated only on the original principal. Compound interest is calculated on the principal plus any interest already earned, so you earn "interest on interest." Over long periods, compounding produces dramatically larger returns.
How does compounding frequency affect returns?+
The more frequently interest is compounded, the higher the effective return. For example, ₹1 lakh at 10% for 10 years: annual compounding gives ₹2.59 lakh, monthly compounding gives ₹2.71 lakh, and daily compounding gives ₹2.72 lakh.
What is the Rule of 72?+
The Rule of 72 is a quick mental shortcut: divide 72 by the annual interest rate to estimate how many years it takes to double your money. At 12% per year, money doubles in roughly 6 years (72 ÷ 12 = 6).
What annual return should I use for equity investments?+
Indian equity mutual funds have historically delivered 12–15% CAGR over 10+ year periods, but past returns do not guarantee future performance. For conservative planning, many advisors use 10–12%. For debt or FDs, use the actual rate offered.