Interest Calculator

Compound Interest Calculator

Calculate how your money grows with the power of compounding. Compare compound interest vs simple interest and see year-by-year growth.

✓ CI vs SI Comparison ✓ 5 Compounding Options ✓ Year-by-Year Table
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Calculate Compound Interest

Enter your principal, rate, tenure, and compounding frequency. Results update live.

1,00,000
₹1,000₹1,00,00,000
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8%
1%30%
%
10 yr
1 yr40 yr
yr

Year-by-Year Growth

Track how your balance grows each year with compound interest.

What is Compound Interest Calculator and How to Use It

A compound interest calculator helps you understand how your money grows when interest is earned not just on your principal but also on the accumulated interest. This is the fundamental principle behind all long-term wealth creation — whether you are investing in fixed deposits, mutual funds, or savings accounts. If you want to use a CI calculator online to compare different investment scenarios, this tool lets you instantly see the impact of different compounding frequencies on your final corpus.

To use the calculator, enter your principal amount, the annual interest rate, the investment tenure in years, and select the compounding frequency that matches your investment product. The calculator instantly shows your final amount, total interest earned, and the extra gain compared to simple interest. The compound interest formula calculator also generates a complete year-by-year table so you can track exactly how your balance grows each year.

The difference between compound and simple interest becomes dramatically more visible over longer tenures. For example, ₹5,00,000 invested at 10% for 20 years earns ₹28,36,500 in compound interest (monthly compounding) versus ₹10,00,000 in simple interest — a difference of over ₹18 lakhs. This extra gain is the “power of compounding” that financial advisors always emphasise.

Compound Interest Formula

Compound Interest Formula: A = P x (1 + r/n)^(n*t) Where: P = Principal amount r = Annual interest rate (decimal) n = Compounding periods per year t = Time in years Simple Interest: SI = P x r x t Extra Gain (CI vs SI): A - (P + SI)

Tips to maximise your returns with compounding

01.Start early — the compounding effect is exponential, so even a few extra years of investment can dramatically increase your final corpus.
02.Choose higher compounding frequency when possible — daily or monthly compounding gives slightly better returns than quarterly or yearly for the same rate.
03.Use this calculator to compare FD offers from different banks — a slightly higher rate with less frequent compounding may actually give lower returns than a lower rate with daily compounding.
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Common Questions About Compound Interest

Compound interest is interest calculated on both the initial principal and the accumulated interest from previous periods. Unlike simple interest, which is calculated only on the principal, compound interest grows exponentially over time — making it the foundation of long-term wealth creation.

The compound interest formula is A = P × (1 + r/n)^(n×t), where P is the principal, r is the annual interest rate (as a decimal), n is the number of compounding periods per year, and t is the time in years. The total interest earned is A − P.

More frequent compounding leads to higher returns. For example, ₹1,00,000 at 10% for 10 years gives ₹2,59,374 with yearly compounding, ₹2,70,704 with monthly compounding, and ₹2,71,791 with daily compounding. The difference becomes more significant at higher rates and longer tenures.

Simple interest is calculated only on the original principal: SI = P × r × t. Compound interest is calculated on the principal plus accumulated interest, so it grows faster. Over long periods, the difference (extra gain) can be substantial — this is the ‘power of compounding’ that makes early investing so valuable.

Daily compounding gives the highest returns mathematically, but the practical difference between daily and monthly compounding is very small. Most bank FDs use quarterly compounding, while savings accounts typically use monthly compounding. Choose the frequency that matches your actual investment product.

Enter your investment amount as the principal, the expected annual return rate, your investment tenure, and the compounding frequency of your investment product. The calculator shows your final corpus, total interest earned, and how much more you earn compared to simple interest — helping you understand the true power of compounding.