FD Calculator
Calculate maturity amount and interest earned on your Fixed Deposit investment.
What is a Fixed Deposit?
A Fixed Deposit (FD) is a financial instrument offered by banks and NBFCs where you deposit a lump sum amount for a fixed period at a predetermined interest rate. It is one of the safest investment options in India.
Unlike savings accounts, FDs offer higher interest rates because you commit your money for a specific tenure. The interest can be compounded quarterly, half-yearly, or annually depending on the bank's scheme.
FDs are ideal for conservative investors who prioritize capital safety over high returns. They are also useful for parking emergency funds or saving for short-term goals.
FD Formula
Where:
- A = Maturity Amount
- P = Principal (Deposit Amount)
- r = Annual Interest Rate (in decimal, e.g., 7% = 0.07)
- n = Compounding Frequency per Year (4 for quarterly, 12 for monthly)
- t = Tenure in Years
💡 Note: Most banks in India use quarterly compounding for FDs. The effective yield is higher than the stated annual rate due to compounding.
Example Calculation
Scenario
You deposit ₹5,00,000 in a Fixed Deposit at 7% per annum for 5 years with quarterly compounding.
Step-by-Step Solution
P = 5,00,000; r = 0.07; n = 4; t = 5
A = 5,00,000 × (1 + 0.07/4)^(4×5)
A = 5,00,000 × (1.0175)^20 = 5,00,000 × 1.4148
A = ₹7,07,393; Interest = ₹2,07,393
Frequently Asked Questions
Bank FDs are among the safest investments. Deposits up to ₹5 lakh per depositor per bank are insured by DICGC (a subsidiary of RBI). For amounts above ₹5 lakh, it's advisable to spread across multiple banks.
Yes, FD interest is fully taxable as per your income tax slab. If interest exceeds ₹40,000/year (₹50,000 for senior citizens), the bank deducts TDS at 10%. You can submit Form 15G/15H to avoid TDS if your total income is below the taxable limit.
Yes, most banks allow premature withdrawal but with a penalty (usually 0.5% to 1% reduction in interest rate). Tax-saving FDs (5-year lock-in under Section 80C) cannot be withdrawn before maturity.
Yes! Most banks offer 0.25% to 0.50% higher interest rates for senior citizens (above 60 years). Some banks offer even higher rates for super senior citizens (above 80 years).
Cumulative FD: Interest is reinvested and compounded, paid at maturity — ideal for wealth creation. Non-Cumulative FD: Interest is paid out periodically (monthly/quarterly) — ideal for those who need regular income, like retirees.
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