Earn some extra money while you save! Putting your money into a good fixed deposit scheme is one of the safest ways to invest. A fixed deposit (FD) scheme is where you can deposit your money with the purpose of earning fixed returns periodically while saving for your future goals. You can deposit your money for a period ranging from 7 days to 10 years as per your convenience. The money in your fixed deposit account earns returns at a higher interest rate than your traditional savings accounts. Fixed deposit accounts also benefit you by allowing overdraft (i.e. loan against FD) of up to 90% of the deposit amount.
Fixed deposit interest rates are based deposit amount, deposit tenure, and bank to bank. The interest rates are compounded quarterly, half yearly or yearly as chosen by you. A fixed deposit account holder is eligible for tax benefits Under Section 80C, given your returns does not exceed Rs 10,000.
Benefits of investing in Fixed Deposits:
- Assured returns on the deposit amount.
- Flexible return options on deposits.
- Simplest investment options with higher returns.
- Special FD interest rates for senior citizens.
- Tax-saver deposit schemes are available.
- Special interest rates for Non Resident Individuals.
The money you invest in a fixed deposit account is your hard-earned money. If you are contemplating to invest money into a fixed deposit account then you must calculate the maturity amount using a fixed deposit calculator. Fixed deposit is considered as an investment option therefore, it is important to calculate the interest returns before investing.
PaisaBazaar offers a fixed deposit calculator which is a distinctly designed to help you calculate your interest returns. It is a convenient online financial tool especially designed to save time by calculating the annualized yield amount within seconds. All you need to do is enter the deposit amount, FD interest rate, and deposit tenure.
What is Deposit Amount?
It is the amount that you deposit into your fixed deposit account at the time of account opening.
What is Rate of Interest?
The Interest rate is the percentage at which you will yield periodic returns. The interest rate varies based on the deposit amount and the deposit tenure.
What is Deposit Tenure?
Deposit tenure if chosen by the deposit account holder at the time of account opening. It is the period of time for which the deposit is made. Banks offer flexible deposit tenures ranging between 7 days to 10 years.
How to check FD returns?
Nowadays all leading lending institutions and financial aggregators (such as Paisabazaar.com) offer fixed deposit calculator to ease the hassle of making lengthy calculations to know the FD returns. In such calculators usually one has to simply enter some basic details, such as investment amount, tenure, and interest rate. And voila, you’ll know your maturity amount, that is the amount you will receive at the end of the fixed deposit’s tenure.
Example:
Ramesh wanted to start saving money and thought of investing in a fixed deposit. He checked online how an investment amount of Rs 1 lakhs would vary with respect to changing interest returns and tenure. Here’s what he found out:
|
Investment amount
|
Tenure
|
Interest rate
|
Maturity amount
|
|
Rs 1
lakhs
|
1 year
|
7.50%
|
1,07,763
|
|
3 year
|
7.50%
|
1,25,144
|
|
|
5 years
|
7.50%
|
1,45,329
|
Based on these results, he decided to open two FDs. The first FD for Rs 1 lakhs for 2 years for financing his short-term goals and another for 5 years as a way of tax-savings and to help him with mid-term goals.
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