Compound Interest Calculator
See how money grows when interest earns interest. Pick how often interest is added, from daily to yearly, and the result updates instantly.
This is an illustration at a steady rate with nothing added or taken out, before tax. Real rates change, and tax on the interest lowers the final figure.
How this is calculated
Final amount = amount × (1 + rate ÷ n)^(n × years), where n is how many times a year interest is added: 365 for daily, 12 for monthly, 4 for quarterly, 2 for half-yearly and 1 for yearly. The result also shows what simple interest would have paid, so you can see what compounding adds.
A worked example
Illustration: 1 lakh rupees at 8% a year for 10 years.
- Compounded yearly: about ₹2,15,892.
- Compounded monthly: about ₹2,21,964.
- Compounded daily: about ₹2,22,535.
- Simple interest, with no compounding: ₹1,80,000.
Compounding of any kind beats simple interest by a wide margin, while the gap between monthly and daily is small. To see the yearly growth rate of an investment you already hold, use the CAGR calculator.
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Questions people ask
What is compound interest?
Compound interest is interest earned on your interest. Each period, the interest is added to your money, and the next period's interest is worked out on the bigger total. Over many years, that snowball is what makes long-term saving grow faster than simple interest.
How is daily compound interest calculated?
The yearly rate is split into 365 daily rates, and interest is added every day: amount = principal × (1 + rate ÷ 365)^(365 × years). In the illustration on this page, 1 lakh rupees at 8% for 10 years grows to about ₹2,22,535 compounded daily, against about ₹2,15,892 compounded yearly.
Does compounding more often make a big difference?
Less than people expect. Going from yearly to quarterly or monthly compounding adds a little; going from monthly to daily adds very little more. The rate and the number of years matter far more than how often interest is added.
What is the power of compounding?
It is the idea that time does most of the work. Money left to compound for 20 years grows far more than twice what it grows in 10, because the later years earn interest on a much larger base. Starting early matters more than starting big.