Compound Interest Calculator
See how your investment grows over time with compounding returns.
Future value
22,196.4
Total invested
10,000
Interest earned
12,196.4
Matures on
—
Growth over time
Year-wise growth
Balance at the end of each year, split into what you put in and what the compounding added.
| Year | On | Invested | Interest | Balance |
|---|---|---|---|---|
| 1 | — | 10,000 | 830 | 10,830 |
| 2 | — | 10,000 | 1,728.88 | 11,728.88 |
| 3 | — | 10,000 | 2,702.37 | 12,702.37 |
| 4 | — | 10,000 | 3,756.66 | 13,756.66 |
| 5 | — | 10,000 | 4,898.46 | 14,898.46 |
| 6 | — | 10,000 | 6,135.02 | 16,135.02 |
| 7 | — | 10,000 | 7,474.22 | 17,474.22 |
| 8 | — | 10,000 | 8,924.57 | 18,924.57 |
| 9 | — | 10,000 | 10,495.3 | 20,495.3 |
| 10 | — | 10,000 | 12,196.4 | 22,196.4 |
Compound interest is interest earned on both your original principal and on the interest that's already accumulated, which is why long-term investments grow faster than simple interest would suggest. Enter a principal, rate, time period, and compounding frequency to see the final balance and total interest earned.
Try different compounding frequencies — annually, quarterly, monthly, or daily — to see how much of a difference it makes, especially over longer time horizons.
Compound versus simple interest, side by side
| Years at 8% on $10,000 | Simple interest | Compounded annually |
|---|---|---|
| 5 | $14,000 | $14,693 |
| 10 | $18,000 | $21,589 |
| 20 | $26,000 | $46,610 |
| 30 | $34,000 | $100,627 |
The gap is modest for a few years and enormous over decades. Compounding rewards time far more than it rewards a slightly better rate.
The rule of 72
Divide 72 by the annual rate to estimate how many years it takes money to double. At 6% that's 12 years; at 9%, eight years. It is an approximation, but an accurate one for rates between roughly 4% and 12%, and the fastest way to sanity-check any growth projection in your head.
Run it the other way to judge a claim: if someone promises to double your money in three years, they are implying a 24% annual return. That is not impossible, but it tells you immediately what level of risk is involved.
What this calculator does not include
- Inflation. A balance growing 7% a year while prices rise 3% has gained about 4% in real purchasing power.
- Tax. Interest, dividends and capital gains are usually taxable, and tax drag compounds against you exactly as returns compound for you.
- Fees. A 1% annual management fee does not cost you 1% — over 30 years it can consume a quarter of the final balance.
- Regular contributions. This models a single lump sum; for a recurring monthly investment, use the SIP calculator instead.
Frequently asked questions
- What's the compound interest formula?
- A = P(1 + r/n)^(nt), where P is principal, r is the annual rate, n is compounds per year, and t is time in years.
- Does compounding frequency really matter?
- Yes, though less than the rate or time period. Monthly compounding earns more than annual compounding at the same nominal rate, but the difference shrinks the more frequently interest already compounds.
- Does this account for additional contributions?
- This calculator models a single lump-sum principal. For regular monthly contributions, see the SIP calculator.
- What's the difference between APR and APY?
- APR is the nominal annual rate before compounding; APY (or effective annual rate) includes the effect of compounding within the year. At 12% compounded monthly, the APR is 12% but the APY is 12.68%.
- Is daily compounding much better than monthly?
- Barely. On $10,000 at 5% for a year, monthly compounding earns $511.62 and daily earns $512.67 — about a dollar. Compounding frequency has diminishing returns as it approaches continuous.
- How do I account for inflation?
- Subtract your expected inflation rate from the return rate and run the calculation again. The result is the balance in today's purchasing power rather than future currency.
Read more on this
- How loan interest actually worksWhy your early repayments barely touch the principal, what a 'flat rate' quote is really costing you, and how to compare two loan offers on the number that matters.
- SIP vs lump sum investing: when each works bestHow dollar-cost averaging shields you from bad timing, why lump-sum historically beats SIP in rising markets, and how to decide based on cash flow.
- Prepaying your home loan vs investing: the math and trade-offsShould you use spare savings to prepay a mortgage or invest in index funds? How to evaluate guaranteed returns, tax deductions, and liquidity.
- How EMI is actually calculated, with a worked exampleThe EMI formula broken down term by term, a full worked example on a real loan amount, and why stretching the tenure can quietly cost you far more in interest.
- Simple vs compound interest: the real difference, with numbersSimple and compound interest side by side on the same principal, rate and term — the exact rupee difference, and why compounding frequency itself changes the total.