
Pricipal Amount
1.00 Lac
Est. Returns
12000
Total Value
1.12 Lac
It is often said that compound interest is the eighth wonder of finance. The compound interest calculator is a quick method of estimating the future compounded value of an investment over a period of time. The compound interest calculator is flexible enough to be used for multiple types of frequency like monthly, quarterly and half yearly compounding. You can use the compound interest calculator online available on the website. For a more Indianized version of the calculator, you can ideally look for compound interest calculator in rupees.
One of the major purposes of the compound interest calculator is to tell you what your capital today is going to be worth tomorrow. The compound interest calculator is especially useful when you are looking to create wealth over the long term. Let us understand the concept of compound interest and the idea of compound interest calculator online in greater detail.
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Let us quickly understand what these various parameters imply.
P is the original investment or the principal Amount
A is the final amount or wealth including compound interest
R is the rate of interest or return payable
N is the number of times interest compounds, so for quarterly, N is 4
T is the total number of years tenure of the investment
Once you feed all these parameters, you can get the eventual compounded amount on your fingertips.
The compound interest concept is a progressive growth concept. For example, if you invest Rs.100,000 with an annual interest yield of 10% for 5 years, the returns for the first year will be 100,000 x 10/100 or Rs.10,000.
However, for the second year, the interest will be calculated on Rs.100,000 + Rs.10,000 or Rs.110,000. The interest will be Rs.11,000. For the third year, the amount of interest will be Rs.12,100.
What we have considered is a very simple and fundamental example. In reality these calculations can get quite complex and cannot be done manually. This requires the use of compound interest calculator for the purpose. These calculators help you to simulate your experiences into a clear cut model and estimate how much you need to invest and how much risk you need to take for a certain wealth target.
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