See exactly how much your savings or investment can grow over time
Enter a principal amount, an interest rate, and how many years — the compound interest calculator instantly shows your maturity value and the total interest earned. Whether you're planning an FD, a lump-sum investment, or comparing deposit options, this tells you the final number in seconds.
All calculations happen right here in your browser. Nothing you enter is stored or sent to any server — your financial details stay completely private.
How to use this calculator
- Principal (₹): Type the amount you're investing or depositing today.
- Annual interest rate (%): Enter the rate the bank or scheme offers — for example, 7% for a typical savings FD.
- Time period: Enter the number of years (or months) you plan to stay invested.
- Compounding frequency: Choose how often interest is added — monthly, quarterly, half-yearly, or yearly. Banks usually compound FDs quarterly.
- Hit Calculate — you instantly see the total maturity amount, interest earned, and a year-by-year growth chart.
Worked example — ₹2 lakh FD at 7.5% for 5 years
Say you park ₹2,00,000 in a bank FD at 7.5% per year, compounded quarterly, for 5 years.
- Principal invested: ₹2,00,000
- Total interest earned: ≈ ₹90,645
- Maturity value: ≈ ₹2,90,645
That's nearly ₹91,000 more than you put in — just from letting interest compound on itself every three months. Had the bank paid simple interest instead, you'd get only ₹75,000 in interest (₹2,00,000 × 7.5% × 5), so compounding adds roughly ₹15,600 extra on this example alone.
How compound interest is calculated — the formula
The core idea: every time interest is added to your account, that interest itself starts earning more interest. The standard formula is:
A = P × (1 + r/n)^(n × t)
Where:
A = Final maturity amount (what you get back)
P = Principal — the amount you start with
r = Annual interest rate as a decimal (e.g. 7.5% → 0.075)
n = Number of times interest compounds per year
(yearly = 1, half-yearly = 2, quarterly = 4, monthly = 12, daily = 365)
t = Time in years
^ = 'to the power of'For the worked example above: A = 2,00,000 × (1 + 0.075/4)^(4 × 5) = 2,00,000 × (1.01875)^20 ≈ ₹2,90,645.
Simple interest uses only the original principal — it never earns on past interest. Compound interest snowballs because each period's interest is added to the base before the next calculation.
How compounding frequency changes your return
Same principal (₹2,00,000) and same rate (7.5% p.a.) for 5 years — only the frequency changes:
| Compounding frequency | n (times/year) | Maturity value (approx.) | Interest earned |
|---|---|---|---|
| Yearly | 1 | ₹2,87,067 | ₹87,067 |
| Half-yearly | 2 | ₹2,88,858 | ₹88,858 |
| Quarterly | 4 | ₹2,90,645 | ₹90,645 |
| Monthly | 12 | ₹2,91,899 | ₹91,899 |
Monthly compounding gives you about ₹4,832 more than yearly on the same money and rate — a reminder to always ask how often a bank credits interest, not just what rate it offers.
Rates and rules to know for FY 2025-26 (AY 2026-27)
- Bank FD rates (2025): Most scheduled banks offer 6.5%–7.5% p.a. on 1–5 year FDs; some small finance banks offer up to 9%. Rates change frequently — always confirm directly with your bank before investing.
- TDS on FD interest: Banks deduct 10% TDS if your total interest from a bank exceeds ₹40,000 in a financial year (₹50,000 for senior citizens). File Form 15G/15H to avoid TDS if your total income is below the taxable limit.
- PPF: Currently earns 7.1% p.a., compounded yearly, declared by the Government each quarter. Interest is completely tax-free. The 15-year lock-in means the compounding effect is very powerful here. Check the current rate on the India Post or your bank's PPF page.
- Section 80C deduction: Investments in PPF, 5-year tax-saver FD, ELSS, NSC etc. are deductible up to ₹1,50,000 per year under Section 80C (Old Tax Regime). This limit has not changed for FY 2025-26.
- New vs Old Tax Regime: Under the New Tax Regime (default from FY 2024-25), the 80C deduction is not available. Interest income from FDs is fully taxable in both regimes at your applicable slab rate. Visit incometax.gov.in for the latest slabs.
- Mutual fund returns: This calculator shows a fixed-rate compound return. Equity mutual fund returns vary — use it with an assumed CAGR (Compounded Annual Growth Rate) to estimate, but remember actual returns are not guaranteed.
Practical tips to get the most out of this tool
- Always match the frequency to your product. Indian banks typically compound FDs quarterly. Using 'yearly' will understate your return.
- Compare products side by side. Run the calculator twice — once for a bank FD at 7% and once assuming a 10% CAGR for a debt fund — to see the long-term difference.
- Don't ignore tax. The calculator shows the pre-tax maturity value. FD interest is taxed as income every year. Factor in your tax slab to find the actual post-tax return.
- Start early — time is the biggest lever. ₹1 lakh at 8% for 20 years grows to ≈ ₹4.93 lakh. Wait 10 years to start and the same money grows to only ≈ ₹2.19 lakh. That's more than half the final corpus lost by waiting.
- This is indicative only. Results assume the rate stays constant throughout. Real FD rates are reset at renewal; equity fund returns fluctuate. Treat the output as a planning number, not a guarantee.
The bottom line: compounding works best when the rate is decent, the time horizon is long, and you leave the money untouched. Use the calculator above to find your number — and start today.