Compound Interest Annual Calculator
Calculate multi-year compound interest growth, maturity values, and returns for Indian savings schemes, PPF, and fixed deposits.
About Compound Growth in Indian Savings Instruments
Compounding generates exponential returns by earning interest on both the initial principal and accumulated past interest. In India, Public Provident Fund (PPF) compounds annually, while commercial bank Fixed Deposits (FDs) compound quarterly.
Formula
A = P × (1 + r / n)n × t
- A: Maturity value
- P: Principal deposit
- r: Annual interest rate (decimal)
- n: Compounding frequency per year
- t: Time in years
Worked Example
Investing ₹1,50,000 at 7.1% annual compounding (PPF rate) over 15 years grows to approximately ₹4,18,900, generating over ₹2,68,900 in interest.
Frequently Asked Questions
How does PPF compounding work?
PPF interest is calculated on the minimum balance between the 5th and the end of each month, and credited to the account annually on March 31st.
Are PPF maturity returns taxable in India?
No. PPF falls under the Exempt-Exempt-Exempt (EEE) tax regime: contributions, accrued interest, and maturity amounts are completely tax-exempt.
Why do quarterly compounding FDs yield higher returns than simple interest?
Because interest earned every 3 months is added to the principal balance for the next quarter's calculation.
What is the Rule of 72?
Divide 72 by the annual interest rate to approximate how many years it will take for your money to double (e.g., 72 / 7.1 ≈ 10.1 years).
Calculate in three steps
- 1Enter your valuesUse the fields above and check the units shown beside each input.
- 2Run the calculationSelect Calculate to refresh the result with your latest values.
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