Fixed Deposit (FD) Calculator
Calculate your Fixed Deposit (FD) maturity amount and interest payouts.
What Is a Fixed Deposit (FD)?
A Fixed Deposit (FD) is a financial instrument offered by banks and non-banking financial companies (NBFCs) where you invest a lump sum for a fixed tenure at a locked-in interest rate. Unlike savings accounts, the rate doesn't fluctuate with the market once you've booked the deposit — this is what makes FDs one of the most predictable, low-risk ways to grow savings in India.
FD tenures typically range from 7 days to 10 years, and interest rates vary by bank, tenure, and depositor category (senior citizens usually get a 0.25%–0.75% premium over standard rates).
Types of Fixed Deposits
Cumulative (Reinvestment) FD
Interest is compounded and reinvested into the principal at each compounding interval (monthly, quarterly, half-yearly, or annually). You don't receive any payout during the tenure — the entire principal plus compounded interest is paid out together at maturity. This option maximizes total returns and suits investors who don't need periodic income.
Non-Cumulative (Interest Payout) FD
Interest is calculated and paid out to your linked bank account at regular intervals instead of being reinvested. This suits retirees or anyone who wants a predictable income stream, though the total returns are lower than a cumulative FD of the same rate and tenure, since the payouts don't compound.
How the FD Calculator Works
Enter four details — principal amount, annual interest rate, tenure, and compounding frequency — and choose whether the FD is cumulative or non-cumulative. The calculator instantly returns:
- Maturity Amount — total value at the end of the tenure
- Total Interest Earned — the compounding gain over your principal
- Effective Annual Yield — the real annualized return, which is higher than the nominal rate whenever compounding is more frequent than annual
- (For non-cumulative FDs) the fixed monthly/periodic payout amount
FD Interest Calculation Formula
Cumulative FD Formula
$$A = P\left(1 + \frac{r}{n}\right)^{nt}$$
- A = Maturity amount
- P = Principal (initial deposit)
- r = Annual interest rate (decimal — e.g., 7.5% = 0.075)
- n = Compounding frequency per year (12 = monthly, 4 = quarterly, 2 = half-yearly, 1 = annually)
- t = Tenure in years
Non-Cumulative FD Formula (monthly payout)
$$\text{Monthly Payout} = A_{\text{maturity}} \times \left(\frac{r}{12}\right)$$
Here, $A_{\text{maturity}}$ is the deposit value at the end of the initial term, and the payout is simple (non-compounding) interest disbursed monthly while the principal stays locked for the payout period.
FD Maturity Amount: Example Calculations
Here's how ₹1,00,000 invested for 5 years at 7.5% grows under each compounding option:
| Compounding | Interest Earned | Maturity Amount | Effective Yield |
|---|---|---|---|
| Monthly | ₹45,329 | ₹1,45,329 | 9.07% |
| Quarterly | ₹44,995 | ₹1,44,995 | 8.99% |
| Half-Yearly | ₹44,504 | ₹1,44,504 | 8.90% |
| Annually | ₹43,563 | ₹1,43,563 | 8.71% |
How Compounding Frequency Affects FD Returns
The more frequently interest compounds, the higher your effective yield — even though the nominal rate stays the same. Monthly compounding on a 7.5% FD delivers a 9.07% effective yield versus 8.71% for annual compounding, a difference of roughly ₹1,766 on a ₹1 lakh, 5-year deposit. Always check whether your bank quotes the nominal rate or the effective annual rate, since this affects like-for-like comparisons across banks.
Fixed Deposit vs Other Investment Options
FD vs Recurring Deposit (RD)
An FD requires a lump-sum deposit upfront; an RD lets you invest a fixed amount monthly. FDs typically suit people with a lump sum to park, while RDs suit those building savings through regular income.
FD vs Savings Account
Savings accounts offer easy liquidity but much lower interest (typically 2.5%–4%) compared to FDs (typically 6.5%–8%+). FDs trade liquidity for a materially higher, locked-in rate.
Benefits of Fixed Deposits
- Guaranteed, predictable returns unaffected by market volatility (for market-linked retirement income instead, see the SWP Calculator)
- Flexible tenure options from 7 days to 10 years
- Loan/overdraft facility available against FD (usually 90–95% of value)
- Deposit insurance coverage up to ₹5 lakh per depositor per bank (DICGC, India)
- Senior citizen rate premiums
Things to Check Before Opening an FD
- Compare effective yield, not just the nominal rate, across banks
- Check premature withdrawal penalty terms (typically 0.5%–1% rate reduction)
- Confirm whether interest is paid monthly, quarterly, or at maturity
- Factor in TDS: banks deduct 10% TDS if interest income exceeds ₹40,000 (₹50,000 for senior citizens) per financial year
- For 5-year tax-saving FDs, note the mandatory lock-in with no premature withdrawal
Frequently Asked Questions (FAQs)
What is the difference between cumulative and non-cumulative FDs?
In a cumulative (reinvestment) FD, the interest is compounded and paid out at maturity, along with the principal. In a non-cumulative FD, the interest is paid out at regular intervals (monthly, quarterly, etc.) and does not compound.
How is interest on Fixed Deposits taxed?
The interest earned on Fixed Deposits is fully taxable according to your income tax slab rates. If the interest income earned across all branches of a bank exceeds ₹40,000 (₹50,000 for senior citizens) in a financial year, the bank will deduct Tax Deducted at Source (TDS) at 10%.
Can I withdraw my Fixed Deposit before maturity?
Yes, most banks allow premature withdrawal of Fixed Deposits. However, banks usually levy a penalty of 0.5% to 1% on the interest rate for the period the deposit was held. Tax-saving FDs (5-year lock-in) cannot be withdrawn prematurely.
Is there a limit on Fixed Deposit investment amount?
There is no maximum limit on Fixed Deposit investments. However, for amounts exceeding ₹2 Crores, banks apply custom bulk FD interest rates which are negotiated separately from standard retail FD rates.
Is FD interest better with monthly or quarterly compounding?
Monthly compounding produces a marginally higher effective yield than quarterly compounding at the same nominal rate, since interest is added to the principal more often. The difference is small in absolute terms but grows with larger principal amounts and longer tenures.
What happens to my FD after maturity if I don't withdraw it?
Most banks automatically renew the FD for the same tenure at the prevailing interest rate unless you've set up different maturity instructions, so it's worth checking your renewal preference when booking the deposit.
Is Fixed Deposit interest better than inflation?
It depends on the prevailing inflation rate. When FD rates fall below inflation, the real (inflation-adjusted) return turns negative even though the nominal amount grows — worth checking with an Inflation Calculator.