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Finance
FD Calculator
A fixed deposit locks money away for a set period at a rate agreed in advance. Enter the deposit, rate and tenure to see the maturity value, the interest earned and the effective annual yield.
How to use this calculator
- Enter the amount you plan to deposit.
- Enter the interest rate your bank is offering for that tenure.
- Enter the tenure in years and months.
- Choose how interest is paid: at maturity, or as a monthly, quarterly, half-yearly or yearly payout.
- Choose the compounding frequency; most Indian banks compound quarterly.
Formula
M = P × (1 + r/n)^(n × t)
- M
- maturity amount
- P
- deposit amount
- r
- annual rate as a decimal
- n
- compounding periods per year, usually 4
- t
- tenure in years
Worked example
₹1,00,000 deposited for 1 year at 7%, compounded quarterly.
- Rate per quarter0.07 ÷ 4 = 0.0175
- Quarters4
- Maturity1,00,000 × 1.0175⁴
Maturity value is about ₹1,07,186, so ₹7,186 of interest and an effective yield of roughly 7.19%.
Cumulative and non-cumulative deposits
In a cumulative deposit, interest stays in the account and compounds until maturity, when you receive the deposit and all the interest together. Choose “At maturity (cumulative)” above to see that maturity value.
A non-cumulative deposit pays interest out monthly, quarterly, half-yearly or yearly instead, and returns only the deposit at the end. Since the interest leaves the account, it does not compound, so the total received is lower. People choose it for regular income, for example retirees. Pick a payout option above to see the amount credited each month or quarter.
Monthly payouts are slightly less than a third of the quarterly payout. Banks compound quarterly, so they pay the monthly equivalent of that rate: on ₹1,00,000 at 7%, about ₹580 a month rather than ₹583, against ₹1,750 a quarter.
Tax on fixed deposit interest
FD interest is fully taxable at your income tax slab rate in India, and it is taxed in the year it accrues rather than when you withdraw. Banks deduct TDS once interest crosses the annual threshold, and you can file Form 15G or 15H if your total income is below the taxable limit.
The maturity figure here is before tax, so your actual return will be lower if you pay tax at a meaningful rate.
Things to keep in mind
- Breaking an FD early usually means a penalty, typically a reduction of around 0.5% to 1% in the applicable rate.
- Senior citizens are generally offered a higher rate; enter that rate directly if it applies.
- Deposits with scheduled banks in India are insured by DICGC up to ₹5 lakh per depositor per bank, covering principal and interest together.
Frequently asked questions
Is FD interest compounded monthly or quarterly?
Most Indian banks compound cumulative fixed deposit interest quarterly. Some products differ, so check the rate schedule or the maturity value in your deposit receipt and match it using this calculator.
What is cumulative interest on an FD?
Cumulative interest means the interest is added to your deposit each quarter and then earns interest itself, so you get the deposit and all the interest together at maturity. In a non-cumulative FD the interest is paid out to you instead, so it does not compound and the total is a little lower.
How much monthly interest will I get on an FD?
At 7% with quarterly compounding, a monthly payout FD pays about ₹580 a month on ₹1 lakh, ₹5,800 on ₹10 lakh and ₹29,000 on ₹50 lakh, before tax. Choose “Monthly payout” above and enter your bank's rate for the exact figure.
Why is the effective yield higher than the rate I entered?
Because interest is added to the balance before the year ends and then earns interest itself. The effective yield expresses that compounding as a single annual percentage, so it is always at least as high as the quoted nominal rate.
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