Interest Calculator
Compound Interest Result
₹4,90,271
Time period: 10 years
Principal Amount: ₹2,00,000
Total Interest: ₹2,90,271
Compounding Frequency: Monthly
No. of times compounded: 120
Total Value: ₹4,90,271
Calculate your earnings and plan your finances smartly with our Interest Calculator. Whether you’re saving, investing, or taking a loan, this tool helps you find out exactly how much interest you’ll earn or pay — using both Simple Interest and Compound Interest formulas.
What is Simple Interest?
Simple Interest (SI) is the easiest form of interest calculation. It is calculated only on the principal amount — the original sum of money you invest or borrow. Unlike compound interest, it doesn’t include interest on previously earned interest.
Formula: A = P (1 + r × t)
Where:
- A = Total amount (Principal + Interest)
- P = Principal amount
- r = Annual interest rate (in decimal, e.g., 8% = 0.08)
- t = Time (in years)
- Interest = A – P
Example:
For a loan of ₹15,00,000 at 8% per year for 5 years –
A = 15,00,000 (1 + 0.08 × 5)
A = 15,00,000 × 1.4 = ₹21,00,000
Interest = ₹21,00,000 – ₹15,00,000 = ₹6,00,000
So, the total payment becomes ₹21,00,000, including ₹6,00,000 interest.
What is Compound Interest?
Compound Interest (CI) means earning or paying interest on both the principal and accumulated interest. It grows your money faster because the interest is reinvested periodically — annually, quarterly, or monthly.
Formula: A = P (1 + r/n)^(n × t)
Where:
- A = Total amount
- P = Principal amount
- r = Annual interest rate (in decimal)
- n = Number of compounding periods per year
- t = Time (in years)
- Interest = A – P
Example:
If you invest ₹15,00,000 at 6% annual interest, compounded monthly (n=12) for 5 years –
A = 15,00,000 (1 + 0.06/12)^(12×5)
A = 15,00,000 × (1.005)^60
A ≈ ₹20,22,300
Interest = ₹20,22,300 – ₹15,00,000 = ₹5,22,300
So, your total returns become ₹20,22,300, including ₹5,22,300 as interest.
Simple Interest Calculator
A Simple Interest Calculator quickly calculates interest on a fixed principal without compounding.
Inputs required:
- Principal amount
- Annual interest rate
- Time duration (years, months, or days)
Example:
For ₹5,00,000 at 6% for 3 years –
A = 5,00,000 (1 + 0.06 × 3) = ₹5,90,000
Interest = ₹90,000
Total Payable = ₹5,90,000
How to Use the Simple Interest Calculator
- Select “Simple Interest.”
- Enter the principal amount (e.g., ₹10,00,000).
- Input the interest rate (e.g., 7%).
- Choose the time duration (e.g., 3 years).
- View the total amount and interest earned instantly.
Compound Interest Calculator
A Compound Interest Calculator helps you find how your money grows over time with compounding interest.
Inputs required:
- Principal amount
- Annual interest rate
- Time (in years)
- Compounding frequency (Monthly, Quarterly, Annually)
Example:
For ₹5,00,000 at 5%, compounded quarterly for 3 years –
A = 5,00,000 (1 + 0.05/4)^(4×3)
A ≈ ₹5,80,350
Interest = ₹80,350
So, your total amount becomes ₹5,80,350.
How to Use the Compound Interest Calculator
- Select “Compound Interest.”
- Enter the principal amount (e.g., ₹10,00,000).
- Input the interest rate (e.g., 5%).
- Choose the time period (e.g., 5 years).
- Select the compounding frequency (Monthly, Quarterly, etc.).
- Instantly get the total amount and interest results.
Benefits of Using an Interest Calculator
- Accuracy: Get precise results within seconds.
- Time-saving: Avoid manual calculations and errors.
- Better Planning: Know your loan EMIs or investment growth in advance.
- Comparison: Compare simple vs. compound interest outcomes.
- Convenience: Works for loans, savings, and investment plans.
Simple Interest vs. Compound Interest
| Feature | Simple Interest | Compound Interest |
|---|---|---|
| Definition | Interest only on the principal amount | Interest on principal + accumulated interest |
| Formula | I = P × R × T | A = P × (1 + R/n)^(n×T) |
| Growth Type | Linear growth | Exponential growth |
| Frequency | Calculated once | Calculated periodically (monthly, quarterly, etc.) |
| Example | ₹1,000 at 5% for 3 years = ₹1,150 | ₹1,000 at 5% compounded annually for 3 years = ₹1,157.63 |
| Best For | Short-term loans, fixed deposits | Long-term investments, recurring deposits |
| Advantage | Easy and predictable | Higher returns due to compounding |
Why Use an Online Interest Calculator
An online interest calculator is perfect for comparing different financial plans, understanding your earnings, and making better investment or loan decisions. Whether it’s a fixed deposit, personal loan, or recurring savings, you can estimate returns and choose the most profitable option effortlessly.
Conclusion
An Interest Calculator is an essential tool for anyone dealing with savings, loans, or investments. It saves time, ensures accuracy, and helps plan your financial goals effectively. Whether you want to estimate loan repayment or investment growth, knowing both Simple Interest and Compound Interest gives you a clear picture of your future returns.
Frequently Asked Questions (FAQs)
What is an Interest Calculator?
It’s an online tool that helps you calculate the total amount and interest for loans or investments using simple or compound formulas.
What’s the difference between simple and compound interest?
Simple interest is calculated only on the principal, while compound interest includes previously earned interest, giving higher returns over time.
What information do I need to calculate interest?
You’ll need the principal amount, interest rate, time duration, and for compound interest, the compounding frequency.
Which is better — simple or compound interest?
For borrowers, simple interest is better because it’s predictable. For investors, compound interest is ideal as it offers faster growth.