Compound Interest Calculator
Calculate compound vs simple interest, FD returns, effective annual rate and wealth growth over time.
Compound vs Simple Interest
Wealth Growth Over Time
Principal vs Interest Split
Understanding Compound Interest
The Formula
A = P × (1 + r/n)^(nt)
P = Principal, r = annual rate, n = compounding periods/year, t = time in years. With monthly additions: each SIP instalment also compounds from its contribution date.
Effective Annual Rate (EAR)
EAR = (1 + r/n)^n − 1. It's the true annual return accounting for compounding. A 7% quarterly-compounded FD has an EAR of 7.19%, higher than the nominal rate.
Rule of 72
Divide 72 by your annual interest rate to estimate how many years it takes to double your money. At 7%, money doubles in ≈10.3 years. At 12%, it doubles in 6 years.
Compounding Frequency
The more frequently interest is compounded, the higher the effective return. Daily > Monthly > Quarterly > Semi-annual > Annual. Most Indian FDs compound quarterly.