Fixed Deposit Calculator

What is FD Calculator?

A fixed deposit typically offers a higher interest rate than a savings account. It is a great way to build a fund that you can use for a vacation, higher education, buying something big or an emergency. It is also a safe way to make your money grow for retirement planning.

Since interest rates can be different depending on the amount and tenure of an FD, it's a good idea to use a fixed deposit calculator to effortlessly make the right decision.

Advantages of Using a Fixed Deposit Calculator

Did you know that the term (time to maturity) for your FD can range from 7 days to 10 years? The interest rate you earn depends on the amount and term of the fixed deposit as well as the applicant's age.

Here's how an FD interest calculator helps:

• FD calculations are prone to error when done manually. The Kotak811 FD calculator simplifies the task for your convenience. It considers all factors and generates accurate results within seconds.
• An FD calculator lists the amount, interest rate, term, total returns on maturity, and interest earned side-by-side to give you the complete picture.
• It saves time and effort. This allows you to make informed decisions and apply for the fixed deposit that is most suited to your needs.
• A well-designed fixed deposit interest calculator lets you compare different options for interest rates and maturity terms to make a decision.

How are Fixed Deposit Interest and Returns Calculated?

There are two types of interest rates on fixed deposits:

Simple interest: It is applied only to the principal amount. It is calculated as:

A = P + [(P x I x T)/100]

Compound interest: It is applied to the principal amount plus the previously accumulated interest. It is calculated as:

A = P x [(1 + I/N) ^ NT]

Where:

A = Maturity amount
P = Principal amount invested
I = Interest rate (usually as a percentage on a per annum basis)
N = Number of times interest is applied
T = Tenure (usually in years)

Sample Calculation
Suppose you invested ₹1,00,000 in an FD for 5 years, at an interest rate of 6.57% per annum.

Here:
P = ₹1,00,000
I = 6.57%
T = 5 years

Calculating with simple interest, we have:

₹1,00,000 + ((₹1,00,000 x 6.57% x 5) / 100) = ₹1,32,850

The maturity amount with simple interest is ₹1,32,850.

Let's say the interest is compounded quarterly, then:

P = ₹1,00,000
I = 6.57%
T = 5 years
N = 4

Calculating with compounded interest, we have:

P x ((1 + I/N) ^ NT)

₹1,00,000 x ((1 + 6.57/4) ^4*5) = ₹1,38,518.18.

The maturity amount with simple interest is ₹1,38,518.

This is why choosing compound interest-based FDs is better. With Kotak811, you can easily choose from monthly, quarterly, and annual compounding of interest for fixed deposits.

Tips to Maximise your Returns from a Fixed Deposit

• Consider different FD schemes. These include the ones for senior citizens, minors, and purpose-based FDs to take advantage of higher interest rates. Remember to set the applicant's age accordingly, when calculating the returns on your fixed deposit.
• Optimising the tenure helps you meet your short- and long-term financial targets. The goal is to maximise the interest received on your investment.
• Do read the terms and conditions to understand the finer details of your chosen amount and tenure.
• Reinvest your returns to earn more interest and grow your money.

You can set automatic re-investment easily from the Kotak811 Mobile Banking App. The fixed deposit calculator also tells you how much you will earn with reinvestment.

Steps to Use a Fixed Deposit Return Calculator Online

An online FD calculator is available 24/7 to know how much your fixed deposit will earn. It is freely available for you to use any number of times. All you need is a computer or mobile phone and an internet connection.

Steps:

1. Download Kotak Bank 811 App from App Store or Play Store
2. Login to you 811 App Locate the FD/RD icon at the bottom menu.
3. Select the FD type (senior citizen or adult) and give it a name.
4. Enter the amount you wish to invest.
5. Select the tenure or set a custom tenure. The interest rate will be automatically updated.
6. The calculator instantly displays the maturity amount and interest you will earn on your investment.
7. You can toggle between Auto-renew FD at maturity.
8. Select the nominee and then slide the Book FD button.

Choose Kotak811 Fixed Deposits for a smooth experience

As FD blocks your money for the maturity period, estimating the returns with an FD calculator is a good idea. Remember that with floating rate FDs, the actual amount at maturity cannot be accurately predicted as the interest rate changes with the repo rates set by the RBI.

The Kotak811 FD calculator is accessible online anytime you need it. The transparent FD interest and deposit returns calculator keeps your expectations realistic. Once you have chosen the FD, you can easily start one with the money you have in your Kotak811 Savings Account. The nominee details are copied automatically. Also, there is no need to upload your documents for KYC separately with each FD.

Fixed Deposit (FD) Calculator FAQs

1. What is Fixed Deposit?

A Fixed Deposit (FD) is a type of investment offered by banks where a lump sum amount is deposited for a fixed tenure, and the depositor earns interest over time. The principal amount is returned to the depositor at the end of the tenure, along with the interest earned.

2. What is the interest rate on a bank FD for senior citizens?

The interest rate on a bank FD for senior citizens is typically higher than that for regular depositors. It varies across banks and the tenure of the FD. Most banks offer an additional 0.25% to 0.50% higher interest rate for senior citizens.

3. How is the interest on a bank FD calculated?

The interest on a bank FD is generally calculated using either the simple interest or compound interest method, depending on the bank’s policy. Compound interest is more common, and it is calculated on the principal amount at regular intervals such as quarterly or yearly. The total interest earned can be calculated manually or using an FD calculator available on bank websites or financial platforms.

4. What is the minimum amount required to start a bank FD?

The minimum amount required to start a bank FD varies by bank. It can range from ₹1,000 to ₹10,000, depending on the bank's policies. Some banks may offer lower amounts for specific types of FDs, like tax-saving FDs.

5. How much can be the minimum tenure of your bank fixed deposit?

The minimum tenure of a bank fixed deposit is usually 7 days, but it can go up to several years. The specific tenure depends on the bank's FD policy.

6. What is the difference between Tax-saver Bank FD & Regular FD?

A Tax-saver FD is specifically designed for tax-saving under Section 80C of the Income Tax Act, allowing a deduction of up to ₹1.5 lakh. It comes with a lock-in period of 5 years. A regular FD does not have a tax benefit and has a flexible tenure.

7. Is the interest earned on a bank FD taxed and how?

Yes, the interest earned on a bank FD is taxable. It is subject to Tax Deducted at Source (TDS) if the interest income exceeds ₹40,000 in a financial year (₹50,000 for senior citizens). The tax rate varies based on your income tax bracket.

8. Which are the forms to submit to avoid Tax Deduction at Source?

To avoid TDS, you need to submit Form 15G (for individuals below 60) or Form 15H (for senior citizens) to the bank, declaring that your total income is below the taxable limit.

9. Is there a penalty if the bank FD is prematurely withdrawn?

Yes, premature withdrawal of an FD usually attracts a penalty. This penalty is typically a reduction of 0.5% to 1% on the interest rate, depending on the bank’s policies. However, you may still receive the principal amount with the adjusted interest.

10. What are the available options to auto-rollover/reinvest the bank FD proceeds?

Banks offer the option of auto-renewal or reinvestment of the FD proceeds at the maturity date. This ensures that the principal and interest are reinvested into a new FD. This process can be set up at the time of opening the FD.

11. What is the interest rate on a bank FD for senior citizens?

Senior citizens often receive higher interest rates on fixed deposits. This additional rate can range from 0.25% to 0.50% higher than the regular FD rates. It's important to check with individual banks for their specific rates.

12. Is there a penalty if the bank FD is prematurely withdrawn?

Yes, premature withdrawal of an FD typically leads to a penalty, which is generally a reduction in the interest rate by 0.5% to 1%. You can check with your bank for the exact penalty charges.

13. How does the FD Calculator help in future financial planning?

An FD Calculator is a useful online tool that helps you calculate the maturity amount, interest earned, and total returns on your fixed deposit based on principal, interest rate, and tenure. This helps in making informed decisions and aids in future financial planning by providing clear projections of the returns from FD investments.