What is a Fixed Deposit (FD)?

A Fixed Deposit (FD) is a financial instrument provided by banks or non-banking financial companies (NBFCs) which offers investors a higher rate of interest than a regular savings account, until the given maturity date. It is considered one of the safest investment options because the returns are guaranteed.

Our FD Calculator helps you determine exactly how much interest you will earn and what your final maturity amount will be based on your investment.

How to Use the FD Calculator

To calculate your FD returns, simply provide the following information:

• Principal Amount: The initial amount you plan to deposit.
• Interest Rate: The annual interest rate offered by the bank.
• Tenure: The duration for which you want to keep the money deposited (in months or years).
• Compounding Frequency: How often the interest is added back to your principal (Monthly, Quarterly, or Yearly).

Why Invest in Fixed Deposits?

Fixed Deposits are a staple of conservative investment portfolios for several reasons:

• Guaranteed Returns: Unlike the stock market, your returns are fixed at the time of deposit.
• Flexible Tenure: You can choose a period ranging from 7 days to 10 years.
• Loan Facility: Most banks allow you to take a loan against your FD (usually up to 90% of the value).
• Senior Citizen Benefits: Banks typically offer a higher interest rate (usually 0.50% more) to senior citizens.

FD Calculator FAQs

How is FD interest calculated?

FD interest is usually calculated using the compound interest formula: A = P(1 + r/n)^(nt). The frequency of compounding (n) significantly impacts the final maturity amount.

Is FD interest taxable?

Yes, the interest earned on Fixed Deposits is generally taxable as per your income tax slab. Banks may also deduct TDS (Tax Deducted at Source) if the interest exceeds a certain limit in a financial year.

Can I withdraw my FD before maturity?

Yes, most banks allow premature withdrawal, but they usually charge a small penalty (typically 0.5% to 1%) on the applicable interest rate.