# Compound Interest Calculator

₹1 lakh at 8% for 10 years grows to about ₹2.21 lakh with quarterly compounding, versus ₹1.80 lakh with simple interest.

Source: https://companystockprice.com/calculators/compound-interest-calculator
Last reviewed: 29 September 2026 (2026-09-29)

With compound interest, interest is added to the principal and itself earns interest. More frequent compounding means slightly higher returns.

## Formula
A = P × (1 + r/n)^(n × t), where n is the number of compounding periods per year.

## Example
₹1,00,000 at 8% for 5 years compounded quarterly grows to about ₹1,48,595, versus ₹1,40,000 with simple interest.

## Scenarios
_₹1,00,000 at 8% a year by compounding frequency_

| Compounding | 5 years | 10 years | 20 years |
|---|---:|---:|---:|
| Simple interest | ₹1,40,000 | ₹1,80,000 | ₹2,60,000 |
| Yearly | ₹1,46,933 | ₹2,15,892 | ₹4,66,096 |
| Half-yearly | ₹1,48,024 | ₹2,19,112 | ₹4,80,102 |
| Quarterly | ₹1,48,595 | ₹2,20,804 | ₹4,87,544 |
| Monthly | ₹1,48,985 | ₹2,21,964 | ₹4,92,680 |

## What changes the result
- The interest rate — the biggest driver by far.
- Time: compounding adds more in later years than in early ones.
- Compounding frequency: monthly beats yearly, but only slightly at typical rates.
- Tax on interest each year (for FDs), which reduces the amount that compounds.

## How to use this calculator
1. Enter the principal amount.
2. Enter the annual interest rate and the number of years.
3. Choose yearly, half-yearly, quarterly or monthly compounding.
4. Compare the compound-interest result with simple interest.

## FAQ
**Does compounding frequency matter much?**
It matters a little: at the same rate, monthly compounding earns slightly more than yearly compounding.

**What is the effective annual rate?**
The yearly rate after compounding. 8% compounded quarterly is an effective 8.24% a year.

**What is the rule of 72?**
Divide 72 by the annual rate to estimate the years needed to double your money. At 8%, money roughly doubles in 9 years.

## Related calculators
- FD Calculator: https://companystockprice.com/calculators/fd-calculator
- Lumpsum Calculator: https://companystockprice.com/calculators/lumpsum-calculator
- RD Calculator: https://companystockprice.com/calculators/rd-calculator

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Results are estimates for planning only and are not financial, tax or investment advice.