FD Calculator

Fixed Deposit (FD) Calculator

Use this Fixed Deposit Calculator to estimate your maturity amount and interest earned based on the principal amount, tenure, interest rate, and compounding frequency. Whether you’re investing in a bank FD, corporate FD, or post office FD, this tool gives you a clear picture of your returns.

How to Use the FD Calculator

• Enter the principal amount you wish to invest.
• Select the annual interest rate offered by the institution.
• Choose the tenure of the investment in years or months.
• Select the compounding frequency (monthly, quarterly, half-yearly, or yearly).
• Choose the FD type – Cumulative (interest is reinvested) or Non-Cumulative (interest is paid out regularly to you).
• View the maturity amount, total interest earned, and a detailed breakdown.

Features of the FD Calculator

• Real-time calculation of maturity amount and interest earned
• Supports monthly, quarterly, half-yearly, and yearly compounding
• Breakdown of interest earned year-wise (with partial months)
• Option to download results as a PDF
• Responsive and mobile-friendly design

Formula Used

For cumulative FDs, the compound interest formula is used:

A = P × (1 + r/n)^nt

Where:

• A = Maturity Amount
• P = Principal Amount
• r = Annual Interest Rate (in decimal)
• n = Compounding Frequency per year
• t = Tenure in years

For non-cumulative FDs, simple interest is used: I = (P × R × T) / 100

Advantages of Using a Fixed Deposit Calculator

• An accurate estimate of returns before investing
• Helps compare FDs from different institutions
• Assists in financial planning and goal setting
• Quick and easy to use without any manual calculations

Try Calculator A2Z’s PPF Calculator

Practical Example

If you invest ₹1,00,000 in a fixed deposit for 2 years and 3 months at an annual interest rate of 7% compounded quarterly, the calculator will show the maturity amount along with a breakdown of how much interest you earn each year and in the final 3 months.

FD vs Other Investment Options

Compared to options like mutual funds or stocks, FDs are low-risk and offer guaranteed returns. However, the returns may be lower than market-linked instruments. They are ideal for short to medium-term financial goals where capital preservation is important.

Is FD a Safe Investment?

Yes, FDs are considered safe, especially those offered by scheduled commercial banks, which are regulated by the RBI. Deposits up to ₹5 lakh per bank per individual are insured by the Deposit Insurance and Credit Guarantee Corporation (DICGC).

Types of FDs

• Bank FDs: Offered by public and private sector banks. Widely trusted and insured.
• Corporate FDs: Offered by companies and NBFCs. Generally offer higher returns but come with higher risk.
• Post Office FDs: Government-backed and ideal for rural and conservative investors. Offered in terms of 1 to 5 years.

Limitations of Fixed Deposits

• Returns may not beat inflation in the long run
• Premature withdrawal often attracts penalties
• Interest earned is taxable as per your income slab

Frequently Asked Questions (FAQs)

1. Can I break my FD before maturity?
Yes, but it may attract a penalty, and the interest rate applicable may be lower than the contracted rate.

2. How is interest on FD taxed?
Interest earned on FDs is fully taxable under the head “Income from Other Sources”. TDS may also apply if the interest exceeds ₹40,000 in a financial year (₹50,000 for senior citizens).

3. What is the best tenure for an FD?
There is no one-size-fits-all answer. Choose the tenure based on your financial goals and interest rate trends. Typically, longer tenures offer higher rates but may lock in your funds.

4. Are returns guaranteed in an FD?
Yes, returns are fixed and guaranteed at the time of investment, unlike market-based instruments. The only condition is that you don’t have to break the FD prematurely. Keep the FD until it matures.

5. What is the difference between cumulative and non-cumulative FDs?
In a cumulative FD, the interest is compounded and paid at maturity. In a non-cumulative FD, the interest is paid out monthly, quarterly, or annually based on your preference.