Guide on How to Use FD Calculator Online

Calculate Fixed Deposit Interest Rates

There is no doubt that fixed deposits are one of the most desirable and sought-after types of financial security among investors worldwide. A Fixed Deposit is a reliable investment tool that can help you earn a consistent income monthly or quarterly. You also can accumulate interest on the deposit until it matures. Because the returns on fixed deposits are not affected by changes in the market, the risk element of fixed deposits has been significantly reduced.

When you open an online FD or fixed deposit account, you invest a sum of money for a predetermined period at a fixed interest rate. You might be curious about how the interest on a fixed deposit is determined. There are two ways that interest rates on fixed deposits can be computed: simple interest and compound interest. The free FD calculator tool can also calculate the online FD maturity amount. Banks or NBFCs can use both of these procedures, depending on the size of the deposit and the length of time it is held.

How much are the returns on fixed deposits?

The predetermined rate of interest that you earn when you invest it in an online FD or Fixed Deposit account is referred to as the returns on Fixed Deposits. The return is accrued incrementally throughout the Fixed Deposit’s term. If you make a Fixed Deposit for five years, you will earn returns at a fixed interest rate for the entirety of the deposit’s term.

The Reserve Bank of India is responsible for periodically adjusting this interest rate, referred to as the base rate. Then, individual banks or NBFCs will decide on a return rate higher than the introductory rate that the RBI has permitted. Consequently, the interest rate applied to FDs will vary from one bank to another. However, the typical interest rate on FD is about 7.75% p.a. or a little bit higher. The typical rate range is between 3 percent and 7 percent, which you can calculate using FD Calculator. This interest rate applies to all holders of online FD or fixed deposits, except senior people, who receive an additional 0.50 percentage points of interest on their Fixed Deposits.

What is the formula for calculating fixed deposit returns?

To determine the accurate returns on fixed deposits, you first need to decide whether you want the money you earn on the FD to be reinvested. You are contemplating cumulative returns if you use this particular approach to calculating returns.

The following is the formula that can be used to calculate the returns on fixed deposits, or you can also calculate it by using the online FD Calculator tool

A= P (1+(r/n) ^ n*t


A = “A” stands for the amount that you will receive upon maturity of the fixed deposit

P = “P” stands for the principal amount that you have invested

r = Rate of interest

t = Number of days

Benefits of Fixed Deposit

  • There is minimal risk associated with the return. Since the money is not in the stock market, there is no risk associated with the market.

  • As per your investment tenor, you will receive a fixed rate of return. It is imperative to note that if the RBI alters the interest rate, the banks may have to change the interest rates they offer.

  • Regardless of whether the bank announces new rates that will apply to existing FDs, you will receive the same rate of return.

  • It is possible to get a loan against your FD.

Tax on FD returns

Besides knowing how to calculate the return on a fixed deposit, whether manually or using the FD calculator tool, it is also essential to be aware of its tax implications. You can invest up to INR 1.5 lakh in a Fixed Deposit account under section 80C of the IT Act 1961. It is an obligation to note that a financial entity with which you open a fixed deposit will deduct TDS if the interest amount earned from your fixed deposit exceeds INR 40,000 in a financial year.


When evaluating the returns on fixed deposits using the FD calculator tool, it is crucial to remain aware of the type of interest applicable to the FD account. Interest on FD accounts can either be cumulative or non-cumulative. If building a corpus is one of your primary objectives, you should select an investment strategy that offers cumulative interest and payouts. On the other hand, if you want your FD to produce a consistent and reliable source of income regularly, you should choose a non-cumulative payout, such as monthly or quarterly interest.


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