Compound Interest Calculator
See how your money grows with compound interest and different compounding frequencies.
- Principal
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- Total interest
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The power of compounding
Compound interest is interest earned on both your original principal and the interest already added. Because each period earns interest on a slightly larger balance, your money grows faster the longer it stays invested — the effect Einstein is often said to have called the eighth wonder of the world. The more often interest is compounded, the greater the final amount.
The compound interest formula
Maturity = P × (1 + r ÷ 100 ÷ n)n × t, where P is the principal,
r is the annual rate, n is the number of times interest compounds each year
(annually, half-yearly, quarterly or monthly) and t is the number of years. The interest
earned is the maturity value minus the principal.
How to use the Compound Interest Calculator
- Enter the principal. Type the amount you invest at the start.
- Add the interest rate. Use the annual rate of interest as a percentage.
- Set years and frequency. Enter the number of years and choose how often interest compounds.
- Read the result. See the maturity value and total interest earned instantly.
Frequently asked questions
Does more frequent compounding earn more?
Yes. For the same rate, monthly compounding earns slightly more than quarterly, which earns more than annual, because interest is added to the balance sooner.
What compounding frequency do banks use?
Indian fixed deposits usually compound quarterly. Savings accounts often compound half-yearly or quarterly. Check your product before choosing the frequency here.
How is this different from simple interest?
Simple interest is charged only on the principal. Compound interest is charged on the principal plus accumulated interest, so it grows faster over time.
Is inflation taken into account?
No. The result is the nominal maturity value. To judge real growth, compare the rate against expected inflation over the same period.