Easy Interest Calculation Using An FD Calculator

Fixed Deposits (FDs) are among the safest investment instruments and are considered by many investors from all age groups. Though FD returns are not exponential, they are assured. Depositors receive returns periodically or at the end of the tenure at an agreed-upon interest rate while opening an FD account.


How Lucrative Current FD Interest Returns


The FD interest rates are lucrative in the rising policy rate scenario. The Reserve Bank of India (RBI) has increased the repo rate four times this year till Sep 30, 2022. As a result, banks are offering a higher FD interest rate.


Senior citizens will have an advantage over regular depositors. Senior citizen bank FDs for individuals aged 60-80 years are offered at an additional interest of 0.5%, and super citizen bank FDs for individuals aged 80+ carry an additional rate of 8.05%.  With leading banks, FD investors can earn at a rate of up to 7.55%.




Let us help you to understand how banks rate interest on fixed deposit and how you can make an informed investment decision using an FD calculator.


FD Compound Interest Calculation Formula


A =  P[1+ (r/n)] ^ n*t


Where, A = Maturity Amount

P = Principal amount.

R = Rate of interest.

T = FD tenure.


Generally, the FD interest rate is compounded quarterly. It seems complex to calculate FD interest if done manually. Therefore, most investors prefer to use an online FD calculator.


How FD Calculator can Help Investors to Calculate Interest


A fixed deposit calculator helps investors to calculate interest in a few clicks. Here are steps to use it:


Step 1 – Select the Customer type – General or Senior Citizen.

Step 2 – Select the Type of FD – Reinvestment for cumulative FD and Monthly or Quarterly Payout for non-cumulative FD.

Step 3: Enter the date of deposit.

Step 4: Enter the FD tenure.

Step 5: Enter the desired deposit amount.


That’s it. The calculator will give you the interest rate applicable to your FD, the total interest amount, and the maturity amount.




For example, you are a non-senior citizen investing in a cumulative FD with a reinvestment option. The deposit amount is Rs. 1 lakh, and the tenure is 60 months.


An FD calculator will show you the following result:


– Rate of Interest: 6.55%

– Annual Percentage Yield: 6.75%

– Interest Earned: Rs.38406

– Total Maturity Balance: Rs.138406

– Maturity Date: 1/11/2027


Depositors can use a fixed deposit calculator in two ways:


  • Investment Amount Approach

Individuals following the investment approach know how much they want to deposit. They just need to input the values into the FD calculator to calculate the interest amount and know the value of their funds over the FD tenure.

The details to be entered are FD type, category of investors, deposit amount, and FD tenure. The user will get the interest rate applicable and the value of the deposit amount on the maturity date. The interest amount varies with the selected compounding period -reinvestment, monthly, or quarterly payout.  


  • Target Amount Approach

Individuals who want to estimate the deposit amount need to invest to achieve the target maturity amount using the fixed deposits calculator following the target amount approach.

They can adjust the input values – FD amount, tenure, and interest payout options in the calculator as often as needed and figure out the amount to get desired returns. It will help them to meet the investment goal at the end of the FD tenure. Based on the entered figures, the FD calculator indicates how much they need to invest to reach the target maturity amount in a defined duration.


You may also read  – How do fixed deposits work



Thus, an online FD calculator helps investors in the following manner:


  • An online FD calculator makes calculations easy. It allows you to calculate the compound interest on your FD in no time.
  • It helps you to know your FD interest rate beforehand. You can choose a suitable FD term and interest payout option to maximize your returns.
  • It helps you to compare returns on different types of FDs. Banks offer different types of fixed deposits for senior and non-senior citizens. An interest rate FD calculator allows you to calculate returns for different types of FD and help you to plan your investments in a better way.


Concluding Comment


A fixed deposit calculator takes a few seconds to estimate the FD interest and maturity value. You can estimate interest earned on different deposits and choose the right type of FD to get interest payouts aligned with your financial goals.


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