The Power of Compound Interest: 30 Lakhs after 10 Years

The Power of Compound Interest: 30 Lakhs after 10 Years

I have discussed the power of compound interest in many of my previous articles. According to the Albert Einstein, “The Greatest Force in the Universe is – The Compound Interest”. He also once said The Compound interest – The 8th Wonder of the world.

The Compound interest is so powerful over the time that, it multiplies your wealth in a breath taking way. The Compound interest is different from the Simple interest. Now, let us discuss that How much your Rs.30 lakhs become after 10 years in various Investments?

We will discuss 3 scenarios – 8% (Bonds), 15-20% (Equity) & 50% (Private Businesses).

Here is the table. See how the rate of return gives different results.

No	Amount	8%	15%	20%	50%
1	8,00,000	864000	920000	960000	1200000
2		933120	1058000	1152000	1800000
3		1007769	1216700	1382400	2700000
4		1088391	1399205	1658880	4050000
5		1175462	1609085	1990656	6075000
6		1269499	1850448	2388787	9112500
7		1371059	2128015	2866544	13668750
8		1480744	2447218	3439853	20503125
9		1599203	2814301	4127824	30754687
10		1727139	3236446	4953389	46132031
Total		17.27 Lakhs	32.36 Lakhs	49.5 Lakhs	4.6 Crore..!!!

See the gross difference between all the rate of returns. only a few percent of difference will make a huge difference in final results over the time. at the rate of 8% returns, it will give 17.27 Lakhs of return while at the rate of 50% it will give 4.6 Crore return….

This is the power of compound interest….