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Visualize the greatest mathematical phenomenon in finance. Discover exactly how 'interest on interest' forcefully multiplies your wealth over time depending on the frequency.
Higher frequency = exponential growth. Monthly compounding beats Yearly. Daily beats Monthly.
Total Wealth Generated
₹3,30,039
Future value after 10 years
Pure Interest Earned
₹2,30,039
The snowball effect in action
Original Principal
₹1,00,000
Your baseline investment
Effective Yeild
230.039%
Absolute return %
| Year | Principal + Accrued Int. | Interest Generated This Year |
|---|---|---|
| Year 1 | ₹1,00,000 | +₹12,683 |
| Year 2 | ₹1,12,683 | +₹14,290 |
| Year 3 | ₹1,26,973 | +₹16,104 |
| Year 4 | ₹1,43,077 | +₹18,146 |
| Year 5 | ₹1,61,223 | +₹20,447 |
| Year 6 | ₹1,81,670 | +₹23,040 |
| Year 7 | ₹2,04,710 | +₹25,962 |
| Year 8 | ₹2,30,672 | +₹29,255 |
| Year 9 | ₹2,59,927 | +₹32,966 |
| Year 10 | ₹2,92,893 | +₹37,146 |
Compound Interest is the 8th Wonder of the World. It calculates interest not just on your principal, but on the interest you've already accumulated.
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Book Free Consultation"Compound interest is the eighth wonder of the world. He who understands it, earns it; he who doesn't, pays it." – Albert Einstein
Time is infinitely more powerful than the rate of return or the principal amount. ₹1 Lakh invested at 12% for 30 years defeats ₹10 Lakhs invested at 12% for 10 years. Start early.
If you borrow a credit card with '3% monthly interest', that is NOT 36% a year. Because it compounds monthly, the effective annualized interest rate is nearly 42.5%. Always check the frequency.
An extension of the Rule of 72. Divide 144 by your interest rate to find out how long it takes for your exact principal to quadruple (4x).
Now apply compounding to real instruments: