What is a CAGR Calculator?
A CAGR (compound annual growth rate) calculator finds the steady yearly growth rate that takes a starting value to an ending value over a given number of years.
CAGR Calculator gives the steady yearly growth rate that would turn the starting value into the ending value. It is the standard way to compare fund returns, company revenue growth or the growth of any value over several years.
How does the CAGR Calculator work?
CAGR is the single yearly growth rate that takes the starting value to the ending value over the period, as if growth were perfectly smooth.
CAGR = (Final value ÷ Initial value)^(1 ÷ years) − 1Worked example using the starting values on this page:
- Initial value
- ₹1,00,000
- Final value
- ₹2,00,000
- Duration
- 5 years
- Initial value
- ₹1,00,000
- CAGR
- 14.87%
- Absolute growth
- ₹1,00,000
- Total return
- 100.00%
How to use the CAGR Calculator
- Enter the initial value (anywhere from ₹1,000 to ₹10,00,00,000). Type it in the box or drag the slider.
- Enter the final value (anywhere from ₹1,000 to ₹1,00,00,00,000). Type it in the box or drag the slider.
- Enter the duration (anywhere from 1 year to 50 years). Type it in the box or drag the slider.
- Read the cagr at the top of the results, then check the breakdown below it.
- Change one input at a time to compare scenarios, and note how much each change moves the result.
Benefits of using the CAGR Calculator
- Turns raw before-and-after numbers into a figure you can compare across investments.
- Shows the working, so the result is easy to verify in a spreadsheet.
- Helps you judge performance fairly by accounting for time and costs.
- Free, instant and private: nothing you enter is stored.
Mistakes to avoid with the CAGR Calculator
The common mistake is using CAGR for investments made in instalments, where XIRR is the right measure.
CAGR describes the smooth path between two points; it does not show the ups and downs along the way.
Helpful checks before using the result
These checks make a cagr more useful in practice.
- Start with a realistic base case rather than the first value that fits the range slider.
- Change one major assumption at a time so the effect stays easy to interpret.
- Use the result to compare scenarios, not as a final provider quote or guaranteed outcome.
- Verify rates, rules, and product terms separately before acting on the estimate.
What CAGR does and does not tell you
A useful single number, as long as its limits are clear.
- CAGR smooths out the path: a fund that fell 30% and then recovered can show the same CAGR as one that rose steadily.
- It only uses the first and last values, so the choice of start and end dates can change it a lot.
- For investments made in several instalments, XIRR is the better measure because CAGR assumes a single amount invested at the start.
CAGR rules of thumb
Quick ways to sanity-check a figure.
Doubling in 5 years
Needs a CAGR of about 14.9%.
Rule of 72
Divide 72 by the CAGR to estimate the years needed to double: at 12%, about 6 years.
Tripling in 10 years
Needs a CAGR of about 11.6%.
CAGR Calculator FAQs
How do I calculate CAGR?
CAGR = (final value ÷ initial value)^(1 ÷ number of years) − 1. ₹1 lakh growing to ₹2 lakh in 5 years gives (2)^(0.2) − 1 ≈ 14.87%.
How much CAGR is needed to double money in 5 years?
About 14.87% a year.
What does a 12% CAGR mean?
The value grew as if it rose 12% every year, compounding. Over 10 years, 12% CAGR turns ₹1 lakh into about ₹3.1 lakh.
Is an 18% CAGR good?
It is high compared with long-run averages for most asset classes, but whether it is good depends on the risk taken and the period measured. Check how the figure changes if you move the start or end date.
