See the power of compounding
Adjust sliders to see how your money grows.
Maturity Amount
₹3,10,585
3.1x your principal in 10 years
Principal
₹1,00,000
CI Earned
₹2,10,585
Simple Interest
₹1,20,000
Extra vs SI
₹90,585
Principal vs Compound Interest
Rule of 72: At 12%, your money doubles in ~6.0 years.
How fast does your money
compound?
Enter your principal, interest rate, and time period to instantly see your maturity amount, interest earned, and how compounding accelerates growth over time.
Step by step
How to use the Compound Interest Calculator
Enter principal amount
Type the starting amount you are investing or have already invested.
Set annual return
Enter the expected annual return or interest rate.
Choose time period
Select how many years the money will compound.
See compounding power
Instantly see how your money grows year by year and compare interest vs principal.
Why use this calculator?
Understand compounding
Compound interest is called the 8th wonder of the world for a reason. Use this calculator to visualise why time in the market matters more than timing the market.
Compare simple vs compound
At 12% for 20 years, ₹1L becomes ₹3.4L with simple interest but ₹9.6L with compound interest. See the gap for your numbers.
Any investment comparison
Use it for FDs, debt mutual funds, corporate bonds, or any fixed-return instrument to compare which compounds your money fastest.
How compound interest works — formula and example
Compound interest is the mechanism that turns a modest investment into significant wealth over time — and the same mechanism that makes debt grow alarmingly fast if left unpaid. The critical insight is that returns compound on returns. In year one, your ₹1 lakh earns ₹12,000. In year two, you earn interest on ₹1,12,000. By year ten, you are earning ₹33,000+ in a single year on the same original ₹1 lakh. This acceleration is invisible in year one and dramatic by year ten.
The Rule of 72 is a fast mental check for compounding: divide 72 by your annual return rate to estimate how many years it takes to double your money. At 8%, money doubles in 9 years. At 12%, it doubles in 6 years. At 6%, it doubles in 12 years. Run this across your investment, FD, and EPF returns to quickly compare where your money grows fastest.
The biggest mistake most people make with compounding is interrupting it. Withdrawing returns, breaking an FD early, or redeeming a mutual fund investment during a market dip resets the compounding clock. The longer you leave an investment untouched, the more disproportionate the gains become in the later years — which is why the last 5 years of a 20-year investment often contribute as much wealth as the first 15.
Formula
A = P × (1 + r/100)ᵗ
A is the final maturity amount. P is the principal (starting amount). r is the annual interest rate as a percentage. t is the time in years. Compound Interest = A − P. Unlike simple interest, the return each year is calculated on the growing balance, not just the original principal.
Worked example
If you invest ₹1,00,000 at 12% for 10 years: A = 1,00,000 × (1.12)¹⁰ = 1,00,000 × 3.1058 = ₹3,10,585. Compare this to simple interest: SI = 1,00,000 × 12% × 10 = ₹1,20,000, giving a total of only ₹2,20,000. The compounding effect adds over ₹90,000 more on the same principal over the same period.
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