Reverse Interest Calculator

How to Use This Calculator

1. Enter the Final Amount - the total amount you want to have after the interest period.
2. Input the Interest Rate as an annual percentage. For example, if the interest rate is 5%, enter 5.
3. Specify the Time Period in years. For example, if you want to know the principal needed for 3 years, enter 3.
4. Click the Calculate button to compute the required principal amount.
5. The calculator will display the principal amount needed in the result section.

Working Principle

This calculator uses the formula for compound interest in reverse. The formula used is:

Principal = Final Amount / (1 + (Interest Rate × Time Period))

This formula calculates the principal amount needed to grow to the final amount given the specified interest rate and time period.

Example

Suppose you want to have ₹1,50,000 after 5 years at an interest rate of 6%. To find out how much principal you need to invest:

1. Final Amount = ₹1,50,000
2. Interest Rate = 6% (or 0.06 as a decimal)
3. Time Period = 5 years
4. Principal = ₹1,50,000 / (1 + (0.06 × 5)) = ₹1,50,000 / 1.30 = ₹1,15,384.62

So, you would need to invest ₹1,15,384.62 to have ₹1,50,000 after 5 years at 6% interest.