Compound Interest Calculator
Albert Einstein famously called compound interest the 8th wonder of the world. It is the simple concept of earning interest on your interest. Use this calculator to see how your initial principal can grow exponentially over time depending on the interest rate and compounding frequency.
The Compound Interest Formula
Why Compounding Frequency Matters
Frequently Asked Questions
What is the difference between Simple Interest and Compound Interest?
Simple interest is calculated only on the principal amount. Compound interest is calculated on the principal amount AND the accumulated interest from previous periods. Over long periods, compound interest results in significantly higher wealth creation.
How often do Indian banks compound interest?
Most Fixed Deposits (FDs) in Indian banks compound interest on a quarterly basis. Savings accounts typically calculate interest on a daily basis but credit it to your account on a quarterly basis.
What is the Rule of 72?
The Rule of 72 is a quick mental math shortcut to estimate how long it takes for an investment to double. Simply divide 72 by the annual interest rate. For example, at an 8% interest rate, your money will double in approximately 9 years (72 ÷ 8).