Free Investment Calculator — Compound Interest & SIP Returns

Compound Interest — The Power of Exponential Growth

Albert Einstein reportedly called compound interest the "eighth wonder of the world." Unlike simple interest (calculated only on the principal), compound interest is calculated on both the principal and the accumulated interest — meaning your money earns returns on its own returns. This creates exponential rather than linear growth.

Lump Sum vs SIP — Which Grows More?

The Rule of 72

The Rule of 72 is a quick mental math shortcut: divide 72 by the annual interest rate to find approximately how many years it takes to double your money.

• At 6% → doubles in 72÷6 = 12 years
• At 9% → doubles in 72÷9 = 8 years
• At 12% → doubles in 72÷12 = 6 years
• At 18% → doubles in 72÷18 = 4 years

Key Investment Concepts

• CAGR (Compound Annual Growth Rate): The annualised return rate of an investment over a period, accounting for compounding.
• XIRR: Extended IRR — used for irregular cash flows like SIPs. More accurate than CAGR for SIP returns.
• Inflation-adjusted return: Real return = Nominal return − Inflation rate. A 12% return with 6% inflation gives only a 6% real return.

Frequently Asked Questions