Compound Interest Calculator
Your savings plan
Tax & purchasing power
Tax is an illustrative deduction from total interest at maturity, not annual taxation or TDS. It does not reduce the compounding balance.
Illustrative rates. Equivalent monthly accrual; actual bank day counts, broken periods, fees and rounding may differ.
| Month | Deposits | Interest | Balance | After tax |
|---|---|---|---|---|
| 12 | ₹1,60,000 | ₹9,497 | ₹1,69,497 | ₹1,69,497 |
| 24 | ₹2,20,000 | ₹23,987 | ₹2,43,987 | ₹2,43,987 |
| 36 | ₹2,80,000 | ₹43,830 | ₹3,23,830 | ₹3,23,830 |
Separate your contributions from the growth they generate
Compound interest earns interest on previously accumulated interest. This tool combines an initial amount with regular additions and makes the nominal rate, compounding frequency and effective annual yield explicit. It models a constant non-negative rate, not stock-market volatility or guaranteed investment performance.
Worked example
At a nominal annual rate of 12%, monthly compounding produces an effective annual yield of approximately 12.6825%. An initial Rs 1,00,000 with no additions becomes approximately Rs 1,12,682.50 in one year before tax.
Formula and calculation assumptions
Monthly rate = (1 + nominal annual rate / frequency)^(frequency / 12) - 1Rates in the formula are decimals. Every month, the balance grows at this equivalent rate. Contributions are added before growth in beginning-of-month mode and after growth in end-of-month mode. No intermediate rounding is applied. Final displays are rounded to rupees; the monthly CSV retains two decimal places. Tenure is an integer number of months.
Estimated tax equals accumulated interest multiplied by your assumed tax percentage. It is deducted only from the final displayed balance, not from annual accrual. Today's purchasing power divides that net balance by (1 + inflation)^(months / 12). Neither tax input nor inflation default is a statutory rate or a forecast.
Reference sources
Investor.gov's compound interest calculator provides a reference for principal, contributions and compounding-frequency inputs. SBI's recurring deposit overview describes regular fixed monthly deposits. Always verify rates and account-specific conditions with your deposit provider.
Common questions
What is the difference between nominal and effective rates?
The entered nominal annual rate is divided by compounding periods per year. Effective annual yield includes interest on interest across those periods. Annual compounding makes the two equal.
How are monthly additions handled with annual compounding?
The model converts the selected compounding convention to an equivalent monthly rate. This assumes fractional-period accrual; an account that credits interest only on specific dates can differ.
Does daily compounding use calendar dates?
No. Daily means 365 compounding periods per year in this model. Tenure uses months divided by 12 and does not apply leap-year or actual-day adjustments.