Compound Interest Calculator

  • Step 1

I want to invest

 ₹ |
Step 2

I want to invest for

Years
5 10 15 20 25 30
Step 3

I will stay invested for

Years
5 10 15 20 25 30
Step 4

I expect rate of return of (Annually)

%
0% 5% 10% 15% 20%

Compound Interest Calculator

Step 1

I want to invest

₹  | 
Step 2

I want to invest for

Step 3

I will stay invested for

Step 4

I expect rate of return of (Annually)

You Invest

₹ 12 Lakhs

Over 10 years

You Get

₹ 40.88 Lakhs
After 26 years @ 8% p.a.
Invest Now

Funds List

Funds List

IN UNIT LINKED INSURANCE PLANS, THE INVESTMENTS RISK IN THE INVESTMENT PORTFOLIO IS BORNE BY THE POLICYHOLDER
Achieve your financial goals &
secure your family's future! Pay 4,000 p.m. for 15 Years & get
Maturity Benefit
13.5 lakh @ 8% assumed rate of return
OR
10.8 lakh @ 4% assumed rate of return
Life Cover
15 lakh
Know More

How can a Compound Interest Calculator Help You?

A compound interest calculator can help you in the following ways:

The compound interest calculator is a fool-proof way to calculate your investment returns. It eliminates the scope of mathematical errors and offers you accurate results.
While your actual returns will likely vary as per the market's ups and downs, you can use the calculator to get an idea of what to expect.

It takes only a couple of minutes to use the compound interest calculator. You can enter your information, and the calculator will determine the results instantly. This saves you from wasting time on manual calculations.

The calculator can be used for a number of investment instruments. All you need to do is enter the investment amount, term of investment, and rate of return.

You can plan for a number of financial goals with the help of the compound interest calculator and avoid any discrepancies along the way.

The online calculator helps you ascertain how much you should invest and for how long to ensure you reach your desired goal within the preferred time frame.

Advantages of using Power of Compounding - Compound Interest Calculator

The compound interest calculator offers the following advantages:

Advantages of using Power of Compounding - Compound Interest Calculator

The compound interest calculator offers the following advantages:

Speed

You save a lot of time with the calculator otherwise spent on manual calculations or reaching out to an expert

Accuracy

The compound interest calculator gives precise and accurate results to ensure error-free financial planning

Reliability

The compound interest calculator is a reliable financial planning tool that can be used by all types of investors and investments

Steps to use ICICI Pru Life's Compound Interest Calculator

Wondering how to calculate compound interest? Below are the steps to use the compound interest calculator:
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cash
Step 1

I want to invest

cash
Step 2

I want to invest for

cash
Step 3

I will stay invested for

cash
Step 4

I expect rate of return of (Annually)

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This step involves entering the amount you intend to invest. This could be your initial investment or an additional contribution. You also need to select the frequency of your investment. You can choose to invest monthly, half-yearly, yearly or make a one-time investment.
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Rate of Return (RoR)

The Rate of Return (RoR) is a measure that indicates the net gain or loss of an investment over a specified time period. It is a crucial metric used to assess the performance of investments. RoR can be applied to various assets, including stocks, bonds, real estate and other financial instruments. Below is the formula to calculate RoR: Rate of return = [(Current value - Initial value)/ Initial value ] x 100
Here :
  • The current value is the present value of the investment
  • The initial value is the original investment amount

Time-Weighted Return (TWR)

Time-Weighted Return (TWR) is a measure of the compound rate of growth of an investment portfolio over a specified time period. It is used to evaluate the performance of investment portfolios accurately, especially when there are multiple cash flows, such as new investments or redemptions. It accounts for the compounding effect of your returns over time. TWR = [(1+HP1) x (1+HP2) ×⋯× (1+HPn)] - 1
Here :
  • n = Number of sub-periods
  • HP = End value - (Initial value + Cash flow)/ (Initial value + Cash flow)
  • HPn = Return for sub-period n
COMP/DOC/Mar/2024/113/5637

Frequently Asked Questions

The frequency of compounding may vary across banks. They usually calculate according to their own will. However, in practice, only a few methods of compounding are used:

  • Annual compounding: Interest is calculated once a year
  • Half-yearly compounding: Interest is calculated every six months
  • Quarterly compounding:Interest is calculated once every three months
  • Daily compounding:Interest is calculated every day

Compounding interest means interest on interest. Each time you earn interest on your principal, it is added to the original amount, which then becomes the principal for the next cycle. This allows exponential growth for your interest. Compounding interest can be good or bad depending on whether you are a saver or a borrower, respectively.

Although the difference won't be much, it is better to opt for daily compounding. The interest amount in case of daily compounding will be slightly higher than the other options. This is governed by the principle: the shorter the compounding interval, the higher the interest.

The power of compounding works by growing your wealth exponentially. It adds the profit earned back to the principal amount and then reinvests the entire sum to accelerate the profit earning process. Suppose, you invest ₹ 1000 in a bank which offers 10% interest per annum. Your investment becomes ₹ 1100 after the first year, then ₹ 1210 after 2nd year and so on.

 
*While the annualized rate of return is 8% during the investment time period of 15 years, the actual returns at the end of each year may not be linear. Moreover, the returns are expected to fluctuate during the policy tenure depending on the prevailing market conditions. This calculation is generated on the basis of the information provided and is for assistance only. It is not intended to be and must not alone be taken as the basis for an investment decision.
 


COMP/DOC/Apr/2023/124/2785
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