Best Fixed Deposit (FD) Calculator Online

Fixed deposits (FDs)

A fixed deposit, also known as an FD, is a product offered by banks and other financial institutions wherein you deposit a sum of money for a specified duration at a fixed rate of interest. The tenure can range from as short as 7 days to as long as 10 years, and the interest rate remains constant during this time. Generally, fixed deposits give returns that are usually higher than in a savings account. Interest gained from this, however, is taxed unless, of course, one takes exemptions, like with the 5-year tax-saving FD.

Understanding Fixed Deposits

1. Principal Amount : This is the amount that is invested,it can be small amounts to large sums according to financial institutions’ policies.

2. Interest Rate : It is fixed for the entire tenure. The interest rate depends on the financial institutions and the tenure. Longer tenure tends to have higher interest rates.

3. Tenure : Tenure is fixed according to your convenience. It can range from 7 days to 10 years. The amount is locked in for a specific period. Withdrawal before that period can lead to penalties.

4. Interest Payment :

   • Cumulative : Here, the interest amount is compounded and is paid at maturity.

   • Non-cumulative : Here, the interest is paid at regularly(monthly, quarterly or yearly).

5. Maturity Amount : The maturity amount is the principal amount along with the interest earned during the tenure.
   Maturity amount= Principal amount + Interest earned during the tenure.

6. Premature withdrawal : The amount may be withdrawn before maturity, but in that case it may lead to a penalty(usually a deduction on the interest rate).

Benefits of having Fixed Deposits

1. It’s safe and secure : FDs are a low-risk investment. The deposited amount is secure and you will also receive a fixed interest. The Deposit Insurance and Credit Guarantee Corporation (DICGC) insures upto ₹5 lakh per bank. Even if the bank fails, you will receive refunds upto ₹5 lakh.

2. Estimated returns : The interest remains fixed and doesn’t fluctuate due to market conditions. The interest gets compounded by the principal amount along with the interest amount.

3. Tax savings : Under Section 80C of the Income Tax Act, you get tax deductions upto ₹1.5 lakh for a financial year, if it has a tenure of 5 years.

4. Regular income generation : Non-cummulative FDs are ideal for people looking for a regular income. Interest can be paid monthly, quarterly or yearly. Senior citizens(60 years and above) receive higher interest rates comparatively.

5. Suitable for different goals : It is suitable for short-term as well as long-term goals depending on your preference. If you want to save up for vacations then short-term FDs are suitable for you and if you want to save up for retirement, long-term FDs are more suitable for you.

Considerations for Fixed Deposits

1. Interest Rates : Compare the interest rate from each source to maximize the returns. Higher rates are available to senior citizens.

2. Lock-In Period : Terms depending on your financial requirements short or long, should be chosen. Early withdrawal might attract a penalty.

3. Taxation : FD interest is taxable; take care of the returns.
   Tax-saving FDs with a tenure of 5 years will reduce the amount of taxable income.

4. Reliability : Banks or institutions with good ratings should be selected.
   Ensure your deposits are insured (e.g., up to ₹5 lakhs in India).

5. Payouts : Want regular income? Opt for non-cumulative FDs (monthly/quarterly payouts).
   Want long-term growth? Opt for cumulative FDs (payout at maturity).

6. Flexibility : Opt for FDs with flexible withdrawal options if you might need funds early.

7. Special Offers : Look for higher rates during festivals or on special schemes.

8. Diversification : Don't put all your money in one FD. Split across banks or tenures for safety and liquidity.

How Does a Fixed Deposit Calculator Work?

A Fixed Deposit (FD) Interest Calculator is a computerized application that enables you to calculate the maturity amount of your FD based on parameters such as the principal amount, interest rate, tenure, and compounding frequency. It saves you from manual calculations and provides accurate results instantly. It also helps you compare various FD plans to make better investment decisions.

The Formula Behind FD Maturity Calculation

The compound interest formula is used to calculate the maturity amount for fixed deposits.

A=P×(1+r/n) ^ n×t

Where

A : Maturity amount

P : Principal amount

r : Annual interest rate expressed in decimal

n : Compounding frequency-usually yearly, half-yearly, or quarterly

t : Tenure of the investment in years.

For instance, if you invest ₹10,000 at an annual interest rate of 6% compounded quarterly for 5 years, the maturity amount will be:

A = 10,000×(1+0.06/4) ^ 4×5

A = ₹13,488.47

How to Use Zactor Tech's Fixed Deposit (FD) Return Calculator?

Access the Calculator: Open the Zactor Tech website or app and navigate to the FD Calculator.

Input Details:

Enter:

Total investment-(e.g., ₹50,000)

Interest rate-(e.g., 7% annually)

FD tenure-(e.g., 3 years)

View Results: The calculator instantly displays the total value and the estimated returns.

Compare Plans: Adjust the parameters to compare different FD schemes and find the best one for your needs.

Benefits of Using Zactor Tech's Fixed Deposit Calculator

• Accuracy : There is no scope for human errors in calculations.

• Time-Saving : Results are available instantly without manual work.

• Customizable Inputs : You can try different combinations of principal, rate, and tenure to evaluate options.

• User-Friendly Interface : It has a simple and intuitive design for seamless user experience.

• Financial Planning : It helps in estimating future returns and planning your finances effectively.

• Free to Use : Available without any cost on Zactor Tech's platform.

You can also check our RD Calculator