Compound Interest Calculator
Calculate compound interest for any investment or loan. Choose your compounding frequency and compare with simple interest.
Compound Interest Calculator
Compound Interest FAQs
How does compounding frequency affect returns?
More frequent compounding = higher effective return. Example: ₹1L at 10% for 5 years: Annual compounding gives ₹1.61L, quarterly gives ₹1.64L, monthly gives ₹1.65L. The difference grows significantly over longer periods.
What is CAGR and how is it related to compound interest?
CAGR (Compound Annual Growth Rate) is the compound interest rate that takes an investment from starting value to ending value. Formula: CAGR = (End Value / Start Value)^(1/years) - 1. It accounts for compounding over the period.
How do I use the Rule of 72?
The Rule of 72 is a quick mental math shortcut: divide 72 by the interest rate to find how many years it takes to double your money. At 8% annual compound interest: 72 ÷ 8 = 9 years to double.
Is compound interest taxable in India?
Yes — interest income (from FDs, savings accounts, etc.) is taxed as per your income tax slab. However, investment returns from equity mutual funds (via SIP) are taxed differently at capital gains rates, not as interest income.
Can compound interest work against me?
Yes — compound interest is extremely powerful for borrowers too, but against them. Credit card debt compounded monthly at 36–42% per year grows very fast. Always pay off high-interest debt before investing.