How is FD interest calculated?

FD interest uses compound interest formula: A = P(1 + r/n)^(nt), where P is principal, r is annual rate, n is compounding frequency, and t is tenure in years.

Is FD interest taxable?

Yes. FD interest is taxable as per your income tax slab. In India, TDS is deducted at 10% if interest exceeds ₹40,000/year (₹50,000 for senior citizens).

FD Calculator - Fixed Deposit Maturity Calculator

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FD Calculator

Calculate your fixed deposit maturity amount

Deposit Amount?The lump sum amount you deposit in the fixed deposit. Most banks have a minimum of ₹1,000 or $1,000.

Annual Interest Rate?The interest rate offered by your bank. Check your bank's website for current FD rates. Senior citizens typically get 0.25–0.5% extra.

Tenure (Years)?Duration of your FD. Tax Saver FDs have a mandatory 5-year lock-in period.

yrs

Additional Months?Extra months beyond the full years. E.g., for a 2.5-year FD, enter 2 years and 6 months.

Compounding Frequency?How often the bank adds interest to your balance. Quarterly compounding (4× per year) is most common for FDs in India.

Maturity Amount

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Principal

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Interest Earned

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Effective Yield

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What is a Fixed Deposit (FD)?

A Fixed Deposit (FD) — also called a term deposit or certificate of deposit — is one of the safest investment instruments available. You deposit a lump sum with a bank for a fixed period at a guaranteed interest rate. Unlike mutual funds or stocks, your principal is protected and the returns are predetermined.

FDs are ideal for risk-averse investors, emergency funds, or short-to-medium term savings goals. In India, bank FDs are insured up to ₹5 lakh per bank by DICGC.

FD Maturity Formula

Maturity = P × (1 + r/n)^(n×t)

Where:
P = Deposit amount
r = Annual interest rate ÷ 100
n = Compounding frequency (4 for quarterly)
t = Tenure in years

How to use this calculator

Select your FD type (Regular, Senior Citizen, Tax Saver, or Corporate)
Enter the deposit amount
Enter the interest rate quoted by your bank
Set the tenure in years and months
Select compounding frequency (quarterly is standard)
Click Calculate to see your maturity amount

📘 Example Scenarios

Scenario 1 — Sunita books an FD for her daughter's wedding 💍

Sunita deposits ₹5,00,000 in an FD at 7.5% per year, compounded quarterly, for 3 years. Maturity amount = approximately ₹6,24,000. She earns ₹1,24,000 in interest — risk-free. This is far better than keeping money in a savings account at 3-4%.

Scenario 2 — David parks emergency funds 🛡️

David has $10,000 in emergency savings. Instead of a regular savings account at 0.5%, he puts it in a 1-year CD at 5.0% (compounded monthly). Maturity = $10,512. He earns $512 extra while keeping the money safe and accessible after 1 year.

FD vs Other Investment Options

FDs offer guaranteed returns and capital safety, making them ideal for short-term goals. For goals beyond 5 years, equity mutual funds have historically offered higher returns (10-14% annualised), though with market risk. A good portfolio often balances both.

Frequently asked questions

An FD is a savings product where you deposit money with a bank for a fixed period at a guaranteed interest rate. Your principal is safe and returns are predetermined, unlike market-linked investments.

Yes, most FDs can be broken prematurely, but banks typically charge a 0.5–1% penalty on the interest rate. Tax Saver FDs have a mandatory 5-year lock-in and cannot be broken early.

Yes. FD interest is added to your income and taxed at your applicable slab rate. In India, TDS at 10% is deducted when annual interest exceeds ₹40,000 (₹50,000 for senior citizens).

Cumulative FDs reinvest the interest and pay everything at maturity (better for wealth creation). Non-cumulative FDs pay interest periodically (monthly, quarterly) — better for regular income needs.