A fixed deposit (FD) is a savings account for fixed income. The users can deposit money in this account over a fixed time period and interest rate. Risk-averse investors prefer FDs as these are safe mode of investment. Both banking and non-banking institutions offer this account and the deposits are called bank deposits and company fixed deposits respectively. The interest is paid for creating either regular income stream or compounded/reinvested for the higher returns.
It is a financial tool online through which the depositor is enabled to calculate the returns on the deposit i.e. maturity benefits. . It is more convenient and easy to use it than calculating FD output on computer spreadsheets. This Calculator is user-friendly. One does not have to do manual calculations but can use the FD calculator to get results within few seconds.
The users are asked to fill the below given details:
When the user fills all the details, he/she then has to hit the option 'Calculate'. This will calculate the returns on deposit and the accurate maturity amount will be shown immediately. With the help of these real-time calculations, the users are able to compare the FDs offered by different banking and non-banking institutions and get an idea of highest return scheme and apply for the same.
In this way the user can plan his/her investments in a better way. These calculations are very useful for deposit renewals. The interest rates may vary at maturity and the renewal is done at rates of interest prevailing to maturity. The new interest rates can be lower or higher as per the norms of the bank. The decision of whether continuing the same deposit or go for another, becomes easy with the help of this calculator.
In this online financial tool, the user is asked to enter the details like amount, time period and the rates of interest of the scheme that he/she have chosen and frequency of compounding meaning how often is the interest reinvested. After filling the details, the user will be provided with the accurate result.
Simple interest can be calculated easily than the compound interest. The use of the FD interest calculator eliminates the requirement of manual calculations. The compounding frequency is also necessary to be noted.
Suppose that the rate of interest is 12% p.a., this is the yearly rate of interest. For calculating the interest at semi-annual bases, the rate of interest will be calculated according to 12 X 6 of 12 months that is 6%, for calculating the interest at quarterly bases, the rate of interest will be calculated according to 12 X 3 of 12 months that is 3%.