The ICICI Compound Interest Calculator is a valuable financial tool designed to help you understand the power of compounding and estimate the future value of your investments. By inputting key details such as the principal amount, interest rate, and time period, you can get an idea on how your money will grow over time.
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Investment Plans
Generate wealthEarn 1 Cr# in maturity with Zero LTCG tax¶
Double tax savings^On premiums (under 80C) and on maturity (under
10(10D))
Compounding interest is the process of earning interest on both the principal amount and the accumulated interest over time. In simpler terms, it means that the interest you earn on your initial investment is reinvested, and then you earn interest on the increased total. This creates a snowball effect, where your money grows at a faster rate than with simple interest, which only earns interest on the principal amount.
For example, if you invest ₹10,000 at a 5% interest rate compounded annually, you'll earn ₹500 in interest the first year. In the second year, you'll earn interest on the original ₹10,000 as well as the ₹500 in interest from the first year, resulting in a total of ₹525 in interest. This compounding effect continues year after year, accelerating the growth of your investment.
Power of Compounding Calculator
YOU INVEST
YOU GET
Investing Amount
₹500₹150,000
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Stay invested for (in years)
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Interest rate
1%25%
Sensex has given 10% return from 2010-2020
How Often is Interest Compounded?
Interest can be compounded at different frequencies, ranging from daily to annually. The more frequently interest is compounded, the faster your investment will grow.
Here are some common compounding frequencies:
Daily: Interest is calculated every day.
Monthly: Interest is calculated once a month.
Quarterly: Interest is calculated every three months.
Semiannually: Interest is calculated twice a year.
Annually: Interest is calculated once a year.
What is the ICICI Prudential Compound Interest Calculator?
ICICI Prudential Compound Interest Calculator is a financial tool provided by ICICI Prudential Life Insurance Company. It allows you to estimate the future value of your investment based on the concept of compound interest. By inputting details such as the principal amount, interest rate, and time period, you can visualize how your investment might grow over time.
This calculator is useful for understanding the power of compounding, which can significantly accelerate wealth accumulation. It can help you make informed decisions about your investments and plan for your financial future
What are the Advantages of using the ICICI Power of Compounding - Compound Interest Calculator?
Below are the advantages of the ICICI compound interest calculator:
Time-saving: The calculator eliminates the need for manual calculations or consulting financial experts, saving you valuable time.
Quick results: You can instantly see the potential growth of your investment based on different scenarios.
Precision: The calculator provides precise and accurate results, ensuring that your financial planning is based on reliable data.
Error-free: By automating calculations, the calculator helps to minimize human errors that can occur in manual calculations.
Trusted tool: The calculator is backed by a reputable financial institution, ICICI Prudential, making it a reliable source for financial planning information.
Versatile: This compound interest calculator can be used by investors of all levels, from beginners to experienced individuals.
Adaptable: It can be applied to various investment types, including savings accounts, fixed deposits, and other financial instruments.
How to Use Policybazaar’s ICICI Compound Interest Calculator?
To use Policybazaar's compound interest calculator ICICI Prudential, follow these simple steps:
Input Investment Amount: Enter the initial amount you plan to invest.
Select Investing For: Choose the duration in years for which you want to invest.
Set Stay Invested For: Specify the period in years for which you intend to keep your investment.
Input Interest Rate: Enter the expected annual interest rate.
Once you submit these details, the calculator will display the following:
You Invest For: The total duration of your investment.
And You Get: The estimated final value of your investment after accounting for compound interest.
How Can the Compound Interest Calculator ICICI Prudential Help You?
Below are the ways how compound interest ICICI can help you:
Estimate future value: Calculate the potential growth of your investment over time.
Understand compounding power: Learn how compounding can accelerate your wealth accumulation.
Set financial goals: Determine the amount you need to invest to achieve specific financial targets.
Plan for retirement: Estimate your retirement savings based on different investment scenarios.
Compare investment options: Evaluate the performance of various investment instruments.
How Does the Power of Compounding Work?
The power of compounding refers to the process where the returns on an investment generate earnings, and those earnings, in turn, begin to generate returns themselves. The longer the investment period, the greater the compounding effect. For example, if you invest a sum of money and earn interest on it, in the next period, you earn interest not only on the original sum but also on the interest already accumulated. This creates a cycle where the investment grows at an increasing rate, making compounding a powerful tool for building wealth, especially in long-term investments.
FAQs
Which is better: daily or monthly compounding?
While the difference may be minimal, daily compounding is generally preferable. With daily compounding, the interest earned will be slightly higher compared to monthly compounding. This is based on the principle that the shorter the compounding interval, the greater the interest accumulated.
How does compound interest compare to simple interest?
Simple interest is calculated only on the principal amount, while compound interest is calculated on both the principal and the accumulated interest. This means that compound interest grows at a much faster rate than simple interest.
Can I use compound interest to calculate the return on my investments?
Yes, you can use compound interest to calculate the return on your investments. Simply input the initial investment amount, the interest rate, and the time period into a compound interest calculator to estimate the future value of your investment.
†Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. The sorting is based on past 10 years’ fund performance (Fund Data Source: Value Research). For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in
Past 10 Years' annualised returns as on 01-11-2024
^The tax benefits under Section 80C allow a deduction of up to ₹1.5 lakhs from the taxable income per year and 10(10D) tax benefits are for investments made up to ₹2.5 Lakhs/ year for policies bought after 1 Feb 2021. Tax benefits and savings are subject to changes in tax laws.
*All savings are provided by the insurer as per the IRDAI approved insurance plan.
Tax benefit is subject to changes in tax laws. Standard T&C Apply
~Source - Google Review Rating available on:- http://bit.ly/3J20bXZ
^^The information relating to mutual funds presented in this article is for educational purpose only and is not meant for sale. Investment is subject to market risks and the risk is borne by the investor. Please consult your financial advisor before planning your investments.
#The investment risk in the portfolio is borne by the policyholder. Life insurance is available in this product. The maturity amount of Rs 1 Cr. is for a 30 year old healthy individual investing Rs 10,000/- per month for 30 years, with assumed rates of returns @ 8% p.a. that is not guaranteed and is not the upper or lower limits as the value of your policy depends on a number of factors including future investment performance. In Unit Linked Insurance Plans, the investment risk in the investment portfolio is borne by the policyholder and the returns are not guaranteed. Maturity Value: ₹1,05,02,174 @ CARG 8%; ₹50,45,591 @ CAGR 4%
¶Long-term capital gains (LTCG) tax (12.5%) is exempted on annual premiums up to 2.5 lacs.
**Returns are based on past 10 years’ fund performance data (Fund Data Source: Value Research).
Generate wealth Earn 1 Cr# in maturity with Zero LTCG tax¶
Double tax savings^ On premiums (under 80C) and on maturity (under 10(10D))
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