What is the compound interest formula?▾
A = P(1 + r/n)^(nt), where P is the principal, r the annual rate as a decimal, n the number of times interest compounds per year, and t the years. Compound interest itself is A − P.
How much difference does compounding frequency make?▾
Less than most people expect, and it diminishes fast. On ₹1,00,000 at 10% for a year, annual compounding gives ₹10,000 and monthly gives about ₹10,471. The gap between monthly and daily is only a few rupees — frequency matters far less than rate and time.
What is the rule of 72?▾
A mental shortcut: divide 72 by the annual rate to estimate the years to double. At 8% that is nine years. It is accurate enough for rates between roughly 6% and 12% and drifts outside that range.
What is the difference between simple and compound interest?▾
Simple interest is calculated only on the original principal. Compound interest is calculated on the principal plus all interest already earned, so it grows faster and the gap widens with time. Over 20 years at 10%, simple interest triples your money and compound interest multiplies it by about 6.7.
Are the rates on this page live market data?▾
No. Every figure here is one you enter — nothing is fetched from a market feed. The calculator applies the compound interest formula to your own assumptions, so the result is only as good as the rate you assume.
