How to use this compound interest calculator
- Enter your lump sum under "Lump sum (initial deposit)", such as the amount you put in an FD. Use 0 if you are starting a new SIP or RD from scratch.
- Add your monthly saving under "Regular deposit (SIP or RD)" and pick the deposit frequency: monthly, or annually for a yearly top-up. Set it to 0 for a one-time FD.
- Set the annual interest rate and tenure. For an FD or RD, use the rate your bank quotes. For a SIP, use a long-run return you consider realistic.
- Check the compounding. It starts at quarterly, the way bank FDs usually compound.
- Open "More options" to raise your deposit each year with "Yearly increase in deposit", change the inflation rate, or make each deposit at the start of the period.
The result shows your maturity value, the total you invest, the interest earned, the effective annual rate and a year-by-year growth table you can download.
The compound interest formula
A = P × (1 + r/n)nt A is the maturity value, P the lump sum, r the annual rate as a decimal, n the number of compounding periods a year (4 for quarterly) and t the tenure in years.
Monthly deposits need one more step, because money goes in every month while interest is added every quarter. The calculator turns the quoted rate into its effective annual rate, (1 + r/n)n − 1, then finds the matching monthly rate, i = (1 + effective rate)1/12 − 1. Deposits of C a month then grow to C × ((1 + i)N − 1) ÷ i after N months. This keeps the yearly growth exactly in line with the compounding you chose. Banks round and credit interest in their own way, so an RD maturity quote may differ slightly.
Worked example
You put in ₹1 lakh at the start and add ₹10,000 a month for 15 years at 7%, compounded quarterly. The quarterly rate is 7 ÷ 4 = 1.75%, an effective 7.19% a year.
- The lump sum grows to 1,00,000 × (1.0175)60 = ₹2,83,182.
- The 180 monthly deposits of ₹10,000 grow to ₹31,58,504.
- Maturity value: ₹34,41,686. You invest ₹19,00,000, so ₹15,41,686, or 45% of the final amount, is interest.
From year 10, the interest you earn each year is more than the ₹1,20,000 you deposit. At 4% inflation, the maturity value is worth about ₹19,11,046 in today's money.
Compounding frequency matters less than the rate or the tenure. The same plan reaches ₹33,86,951 if interest compounds annually and ₹34,54,518 if it compounds monthly. Earning 8% instead of 7% would add ₹3,30,674, and putting in ₹1,000 more a month would add ₹3,15,850.
How your money grows over time
A single FD-style deposit of ₹1 lakh at 7%, compounded quarterly, with nothing added:
| Tenure | Maturity value | Interest earned |
|---|---|---|
| 1 year | ₹1,07,186 | ₹7,186 |
| 3 years | ₹1,23,144 | ₹23,144 |
| 5 years | ₹1,41,478 | ₹41,478 |
| 10 years | ₹2,00,160 | ₹1,00,160 |
| 15 years | ₹2,83,182 | ₹1,83,182 |
At this rate the deposit roughly doubles in 10 years. And ₹10,000 a month, RD or SIP style, at the same 7%:
| Tenure | You invest | Maturity value |
|---|---|---|
| 5 years | ₹6,00,000 | ₹7,15,180 |
| 10 years | ₹12,00,000 | ₹17,27,001 |
| 15 years | ₹18,00,000 | ₹31,58,504 |
| 20 years | ₹24,00,000 | ₹51,83,763 |
| 25 years | ₹30,00,000 | ₹80,49,055 |
The last five years add about ₹28.7 lakh, far more than the ₹17.3 lakh you have after the first ten. Time does most of the work, so starting early matters more than starting big.
FD, RD and SIP in this calculator
- Fixed deposit (FD): enter the amount as the lump sum and set the regular deposit to 0. Bank FDs usually compound quarterly, which is the default.
- Recurring deposit (RD): RDs take monthly deposits, so set the lump sum to 0 and enter your monthly instalment as the regular deposit.
- Mutual fund SIP: the maths is the same, but returns are market-linked rather than interest. They are not guaranteed and vary from year to year, so use a cautious long-run figure and test a lower one.
All figures are before tax. How interest and returns are taxed depends on the product and your own situation, so the calculator does not estimate it.
Step up your deposit with your salary
Many people raise their SIP or RD when they get an increment. Set "Yearly increase in deposit" to 10% in the example and the ₹10,000 a month becomes about ₹37,975 a month by year 15. You invest ₹39,12,698 in total, and the maturity value rises from ₹34,41,686 to ₹62,07,025.
PPF, EPF and NPS
PPF, EPF and NPS are common long-term savings schemes in India, and all of them grow through compounding. Each has its own rules on contributions, returns and withdrawals, which this calculator does not model, so use it for a rough picture rather than an exact maturity figure. To check whether your long-term saving is on course for retirement, use the retirement corpus calculator.
Inflation and today's rupees
The default inflation of 4% is the RBI's target for CPI inflation, which has a tolerance band of 2–6%. It is an assumption, not a forecast. Even at 4%, the ₹34.4 lakh maturity value buys only what about ₹19.1 lakh buys now; at 6%, it would be about ₹14.4 lakh. The inflation calculator shows how prices add up over time. If you are saving for a set target, the savings goal calculator works backwards from the amount you need, and the simple interest calculator shows how much less you would earn without compounding.
Frequently asked questions
How is compound interest calculated?
How does quarterly compounding work on an FD?
What will ₹10,000 a month become in 15 years?
Can I use this calculator for a SIP?
Does it work for PPF, EPF or NPS?
What does "in today's money" mean?
Sources and further reading
Independent, official guidance on this topic. Rules differ by country, so check the regulator where you live.
- Reserve Bank of India: regulations, notifications and consumer awareness · Reserve Bank of India
This calculator gives estimates for education and planning. It is not financial advice, and your lender's figures may differ. See how we calculate.