CAGR Calculator
Enter what you invested, what it became and how long it took — and instantly see the compound annual growth rate (CAGR), total return and growth multiple.
CAGR = (Final ÷ Initial)^(1 ÷ years) − 1. It smooths returns into one steady annual rate — actual year-to-year returns will vary.
What is CAGR?
CAGR (Compound Annual Growth Rate) is the single steady yearly rate at which an investment would have grown from its starting value to its ending value, assuming every year's profit was reinvested and compounded. It answers the question that raw "total return" numbers hide: "what did I actually earn per year?" Because it standardises everything to one annual rate, CAGR lets you line up a 3-year stock trade, a 5-year mutual fund and a 10-year property deal on exactly the same scale.
The CAGR formula
CAGR = (Final Value ÷ Initial Value)^(1 ÷ Years) − 1
Divide the final value by the initial value to get the growth multiple, raise it to the power of one-over-years, subtract one and multiply by 100 for a percentage. There are only three inputs — what you started with, what you ended with, and how long you held — which is exactly what the calculator above asks for.
Worked examples at a glance
The table below runs the same formula across a spread of realistic Indian scenarios, so you can see how the starting value, ending value and holding period combine into a single annual rate.
| Initial | Final | Years | Total return | Multiple | CAGR |
|---|---|---|---|---|---|
| ₹1,00,000 | ₹1,50,000 | 3 | 50% | 1.5× | 14.47% |
| ₹1,00,000 | ₹2,50,000 | 5 | 150% | 2.5× | 20.11% |
| ₹5,00,000 | ₹10,00,000 | 6 | 100% | 2× | 12.25% |
| ₹2,00,000 | ₹6,00,000 | 10 | 200% | 3× | 11.61% |
| ₹1,00,000 | ₹10,00,000 | 20 | 900% | 10× | 12.20% |
Why the same profit gives very different CAGRs
Total return on its own is misleading because it ignores time. Doubling your money is a 100% total return every single time — but the annual rate that produced it depends entirely on how long it took:
| Investment | Time to double | Total return | CAGR |
|---|---|---|---|
| ₹1,00,000 → ₹2,00,000 | 3 years | 100% | 25.99% |
| ₹1,00,000 → ₹2,00,000 | 5 years | 100% | 14.87% |
| ₹1,00,000 → ₹2,00,000 | 7 years | 100% | 10.41% |
| ₹1,00,000 → ₹2,00,000 | 10 years | 100% | 7.18% |
| ₹1,00,000 → ₹2,00,000 | 12 years | 100% | 5.95% |
This is why CAGR is the fairer yardstick: doubling over 3 years (about 26% a year) is a completely different achievement from the same 100% gain stretched over 12 years (under 6% a year, barely ahead of a bank deposit). Whenever a fund advertisement or a stock tip quotes only a big total-return number, mentally divide it by the number of years to see how impressive the annual rate really is — a "200% return" over 15 years is a modest 7.6% CAGR.
CAGR vs absolute return vs XIRR
Three return measures get used almost interchangeably in India, yet each answers a different question — and picking the wrong one either flatters or understates your performance.
| Measure | What it tells you | Best used for |
|---|---|---|
| Absolute return | Total percentage gain over the whole period, ignoring time | Holdings under a year; a quick headline number |
| CAGR | The smoothed annual compounded rate | A single lump sum held one year or more; comparing assets |
| XIRR | Annual return that weights every cash flow by its date | SIPs, top-ups, partial withdrawals, irregular flows |
The rule of thumb: use absolute return for holdings under a year, CAGR for a single lump sum held longer, and XIRR the moment there is more than one cash flow. To project a one-time investment forward instead of measuring it backward, use our lumpsum calculator; for monthly investing, the SIP calculator handles the multiple instalments that CAGR cannot.
Working backwards: what CAGR do you need?
CAGR is usually calculated from a result you already have. Planning runs the other way: you know the multiple you want and the years you have, and you need the growth rate that gets you there. That rate is:
Required CAGR = (target multiple)^(1 ÷ years) − 1
The table below gives the answer directly. Read down your time horizon and across to the multiple you are aiming for:
| Years available | To double (2×) | To triple (3×) | To 5× | To 10× |
|---|---|---|---|---|
| 3 years | 26.0% | 44.2% | 71.0% | 115.4% |
| 5 years | 14.9% | 24.6% | 38.0% | 58.5% |
| 7 years | 10.4% | 17.0% | 25.8% | 38.9% |
| 10 years | 7.2% | 11.6% | 17.5% | 25.9% |
| 15 years | 4.7% | 7.6% | 11.3% | 16.6% |
| 20 years | 3.5% | 5.6% | 8.4% | 12.2% |
| 25 years | 2.8% | 4.5% | 6.6% | 9.6% |
Use this table as a reality check on a plan. If a goal requires more than about 15% a year, the honest conclusion is usually not that you need a better fund but that you need more years, a larger monthly contribution, or a smaller target. Read the required rate against the benchmark figures below before accepting it.
The Rule of 72 shortcut
You do not always need a calculator to sense-check a CAGR. The Rule of 72 estimates how long money takes to double — just divide 72 by the annual rate.
- At 12% CAGR, money doubles in roughly 72 ÷ 12 = 6 years.
- At 8% it takes about 9 years; at 6%, about 12 years.
- Run it backwards too — if a fund doubled in 8 years, its CAGR was about 72 ÷ 8 = 9%.
It is an approximation that works best for rates between roughly 6% and 20%, but it is close enough for mental math and pairs naturally with compound interest planning.
Benchmark CAGRs in India
A CAGR only means something next to a benchmark. These indicative long-run figures help you judge whether a return is genuinely strong or merely keeping pace with the crowd:
| Instrument | Indicative long-run CAGR |
|---|---|
| Savings bank account | ~2.5–3.5% |
| Bank fixed deposit | ~6–7.5% |
| PPF (current rate) | 7.1% |
| EPF (current rate) | 8.25% |
| Gold (long-run average) | ~8–10% |
| Large-cap equity (long run) | ~11–14% |
| Retail inflation (CPI) | ~5–6% |
The real test is beating inflation. With retail inflation typically around 5–6%, a 7% FD delivers barely 1–2% of real growth, while long-run equity has historically stayed comfortably ahead. Use our inflation calculator to convert any nominal CAGR into what it is actually worth in today's rupees.
Limitations to keep in mind
- It assumes a single lump sum with no additions or withdrawals. For SIPs or staggered investments CAGR misstates the truth, so reach for XIRR instead.
- It smooths away volatility. A fund showing 14% CAGR may have swung from −30% to +40% in individual years; the single figure hides that ride entirely.
- It is backward-looking. A high past CAGR is history, not a promise — the standard caution that past performance may not be sustained applies.
- For periods under a year, annualising a short burst of return exaggerates it, so quote absolute return rather than CAGR.
Frequently Asked Questions
What CAGR do I need to double my money?
What CAGR is needed to grow ₹1 lakh to ₹10 lakh?
How do I calculate the CAGR I need for a financial goal?
What is a good CAGR for investments in India?
What's the difference between CAGR and absolute return?
Can CAGR be negative?
Should I use CAGR or XIRR for SIPs?
How does the Rule of 72 relate to CAGR?
How do I calculate CAGR in Excel or Google Sheets?
=(Final/Initial)^(1/Years)-1, then format the cell as a percentage. For example, =(250000/100000)^(1/5)-1 returns 20.11%. Referencing cells such as =(B2/A2)^(1/C2)-1 works the same way.Is CAGR the same as annualised return?
What CAGR should I assume for retirement planning?
Method
This calculator uses standard mathematics, not a statutory rate, so there is nothing here that can go out of date. The formula it applies is:
CAGR = (Ending ÷ Beginning)^(1 ÷ years) − 1, expressed as a percentage. It is the single constant annual rate that would take you from the beginning value to the ending value over that period. It deliberately ignores the path taken, so it says nothing about the volatility along the way.