What is compound interest?

Compound interest is interest calculated on both the initial principal and the accumulated interest from previous periods. Unlike simple interest (calculated only on the principal), compound interest makes your money grow faster because you earn "interest on interest". This is often called the power of compounding.

What is the compound interest formula?

The compound interest formula is A = P × (1 + r/n)^(n×t), where A is the final amount, P is the principal, r is the annual interest rate (as a decimal), n is the number of times interest is compounded per year, and t is the time in years. The compound interest earned is CI = A - P.

What compounding frequencies are supported?

This calculator supports four compounding frequencies: Monthly (12 times/year), Quarterly (4 times/year), Half-Yearly (2 times/year), and Yearly (1 time/year). Monthly compounding gives you the highest returns, while yearly compounding gives the lowest — for the same rate and time period.

How does compound interest differ from simple interest?

Simple interest is calculated only on the original principal: SI = P × r × t. Compound interest is calculated on principal plus accumulated interest. Over time, compound interest grows exponentially while simple interest grows linearly. Our calculator shows both side-by-side so you can compare.

Is this compound interest calculator accurate?

Yes, this calculator uses the standard mathematical compound interest formula and provides accurate results. It runs entirely in your browser using JavaScript — no rounding shortcuts or approximations. The year-by-year breakdown lets you verify each step of the calculation.

Can I use this for FD/RD/PPF calculations?

Yes! Fixed Deposits typically use quarterly compounding, PPF uses yearly compounding, and some savings accounts use monthly or daily compounding. Simply select the appropriate compounding frequency, enter your deposit amount and interest rate, and the calculator will show your maturity value.

Compound Interest Calculator

Calculate compound interest with yearly breakdown. Supports monthly, quarterly & yearly compounding.

Updated Mar 2026100% Private — runs in browser

Principal Amount₹1,00,000

Interest Rate (% p.a.)8%

Time Period (years)5 yr

Compounding Frequency

How often interest is compounded

Total Value at Maturity

₹1,46,933

Principal

₹1,00,000

68.1%

Total Interest

₹46,933

31.9%

Interest Earned

46.9%

on principal

Principal 68.1%Interest 31.9%

Compound Interest vs Simple Interest

Compound Interest

₹46,933

Simple Interest

₹40,000

Extra Earnings (CI)

+₹6,933

CI: ₹1,46,933100%

SI: ₹1,40,00095.3%

Formula Used

A = P × (1 + r/n)^n×t

A = Final Amount

P = Principal (₹1,00,000)

r = Rate (8%)

n = Comp. freq (1/yr)

t = Time (5 yrs)

* This calculator provides estimates for educational purposes. Actual returns depend on the financial product, institution, and applicable taxes. Consult a financial advisor for investment decisions.

How to Use Compound Interest Calculator

1
Enter your principal (initial investment) amount using the slider or type it directly.
2
Set the annual interest rate (e.g., 7% for FD, 7.1% for PPF).
3
Choose the time period in years.
4
Select the compounding frequency — monthly, quarterly, half-yearly, or yearly.
5
View your total maturity amount, interest earned, and CI vs SI comparison instantly.
6
Click "Show Year-by-Year Breakdown" to see how your investment grows each year.

About Compound Interest Calculator

The compound interest calculator by ToolsArena is a free, no-signup tool that helps you calculate how your money grows over time. Whether you're planning a fixed deposit (FD), recurring deposit (RD), PPF investment, or simply understanding the power of compounding — get instant, accurate results.

Key Features

Multiple Compounding Frequencies: Choose monthly, quarterly, half-yearly, or yearly compounding to match your investment.
Year-by-Year Breakdown: See exactly how your investment grows each year with a detailed table.
CI vs SI Comparison: Compare compound interest vs simple interest side by side to see the real advantage of compounding.
Visual Breakdown Bar: Shows the proportion of principal to interest in your final maturity amount.
Transparent Formula: Uses A = P × (1 + r/n)^(n×t), displayed on the page so you can verify the math.

Who Is This For?

Students, investors, and anyone planning their financial future. Ideal for comparing FD rates, understanding PPF growth, or learning how compounding accelerates wealth creation over time.

Privacy & Security

Runs 100% in your browser — no data is sent to any server, no signup required.