Using an FD interest rates calculator to compute your maturity amount and compare alternative interest rates is a great way to make your investment. It is a quick and straightforward way to compare the maturity amount you’ll receive when your FD matures.
The Benefits of Using an FD Interest Rates Calculator
Using an FD interest rates calculator has several advantages, including:
- Calculates the maturity amount with precision, allowing you to choose the ideal term for your deposit.
- You can evaluate various interest rates to get the best alternative for your deposit.
- Calculations are free of human error.
- Calculate maturity amounts in a fraction of the time it takes to do it with a digital calculator or spreadsheet.
- You can make smarter decisions on fixed deposit renewals by comparing maturity amounts.
How to Calculate Maturity Amount Using FD interest rates calculator
Using an FD interest rates calculator is reasonably straightforward, and most of the FD interest rates calculators available online have an excellent user interface. All you have to do is follow the steps below, and you’ll be able to figure out your maturity amount in no time.
- Choose your category: Whether you are a senior citizen or below 60 years of age. It will help in the accurate calculation of your interest rate, as senior citizens enjoy an additional 0.25 % interest.
- Fill in the amount you want to invest in a fixed deposit.
- Enter the tenor for which you want to invest in the FD.
- Choose the payout period, i.e., whether you want the final amount at maturity or a steady amount monthly, quarterly, half-yearly or yearly.
You should be able to view the maturity amount you can expect when your fixed deposit matures after filling in these details, along with the interest rate being offered and the interest you will earn at maturity.
How is the interest on a fixed deposit calculated?
Simple interest and compound interest are the two most common methods for calculating the interest rate on a fixed deposit.
Simple Interest: This is a rate of interest fixed for a specific length of time. It is determined by multiplying the annual interest rate, the principal amount, and the number of years left on the loan.
For example, if you deposit Rs.1 lakh for five years at a rate of 10% p.a., your interest amount at maturity will be as follows using a simple interest calculation:
SI: P x R x T/100
SI: 1,00,000 x 10 x 5/100 = 50,000
Maturity amount at the end of the 5-year deposit tenor: Rs. 1.5 lakh.
Compound Interest
It is the interest earned on both the principal and interest amounts. It’s determined by multiplying the interest rate by the principal amount multiplied by the number of compounding periods, expressed in years.
A = P (1+r/n) ^ (n * t)
A = Maturity amount
P = Principal amount
r = rate of interest in decimals
n = number of compounding in a year
t = number of years
For a deposit amount of Rs.10,000 that is kept for a tenure of 3 years at a quarterly compounding interest rate of 10%, the interest at the time of maturity would be:
A= 10,000 {1 + (0.1/4)} ^ (4 * 3)
A = 10,000 (1 + 0.025) ^ (12)
A = 10,000 (1.025) ^ (12) = Rs. 13,449 (approximately)
Compound Interest (CI) = Maturity Amount – Principal Amount
CI = 13,449 – 10,000 = Rs. 3,449
Maturity amount at the end of the 3-year deposit tenure: Rs.10,3449
Frequently Asked Questions about the FD interest rates calculator
Q1. What variables influence the interest rates on FDs?
FD Interest rates 2022 are influenced by several factors: the deposit’s term, the applicant’s age (senior citizens often receive higher interest rates), and current economic conditions.
Q2. What is the duration for which simple interest is calculated?
The simple interest method calculates interest rates for terms less than six months.
Q3. How long does a fixed deposit have to be held?
Fixed deposits have a seven-day minimum term.
Q4. Is there any documentation required to use the online FD interest rates calculator?
No, while utilising the FD interest rates calculator, no documentation is required.
Q5. Do different banks have their own FD deposit calculators?
You can use the Bajaj Finance FD interest calculator to determine how much money you’ll get at maturity from any bank based on their rates.
Q6. How much does it cost to use a fixed deposit calculator?
The fixed deposit calculator is completely free to use. It is a free internet application that anyone may use and is accessible 24 hours a day, seven days a week.
Q7. How many times can I use a fixed deposit calculator in one day?
You can use a fixed deposit calculator as many times as you want throughout the day.
Q8. Is it possible to use the fixed deposit calculator on a mobile browser?
Yes, you may also use the fixed deposit calculator on mobile browsers.
Q9. How many FD scheme interest rates can the FD interest rates calculator calculate at once?
The fixed deposit calculator can only compute the interest rate for one FD plan at a time.