An easy tool for FD Calculator that help you to calculate the total maturity amount along with interest rates for next 25 years. Just enter the amount, you wish to invest in any Bank with duration and interest rate and it will display the total interest earned and value of your money.
As we all know that after recent note banned, most of the banks reduced the interest on fixed deposit. Today majority of the banks offering 7.0% of interest rates on above 1 year. Therefore you should make your chose wisely in order to get better return from your investment.
You can use this fixed deposit calculator to find out which banks is providing higher returns on term deposit. You can check the list of banks and their rate of interest on right hand side of the page. If you are young, can take little bit of risk then you can go for NCD (non-convertible debentures) which is more like term deposit, but its comes from private sector companies. Companies like Muthoot Finance are offering about 8 to 9 % of interest rates on their deposit. So choose your step wisely.
About Fixed Deposit
From last 50 years, the FD is considered as one of the safest ways to invest the hard earned money into a bank that provide certain rate of interest rate on saving account. The Term Deposit is very popular in India, as it provides a fixed amount of returns on investment, additionally the final amount that comes after maturity is usually slightly higher. Moreover you don’t have to do any work on it and the money itself keeps growing. However it also the truth that the returns are usually lesser than other investment opportunities but at the same time, it is also provides you the peace of mind being the safest investment.
Most of the Private and Govt. Sectors Banks in India do offer same or similar rate of interest rates; however in order to attract customers, the rates might vary from Bank to Bank.
Things to remember while doing FD Calculation
When it comes to term deposit, there are some limitations which are mentioned below:
- Majority of the Banks require minimum of Rs 10,000 as the investment amount.
- Majority of the Govt. sectors Banks provides an option to the investors to open the FD account as low as for 15 days to maximum of 20 years of time.
- Once its open, then you can’t withdraw the fund before the maturity rate, therefore has low liquidity.
- Withdrawing before maturity will attract 1 to 2% of penalty charges and also get lesser returns.
While opening a FD account, you have three options for ‘Maturity Instructions’ which are mentioned below:
- Renew Principal with Interest
- Renew Principal Only
- Transfer Maturity Amount to A/C
So choose wisely!!
One more thing that every investor should be aware of the fact that, the total interest earned on Fixed Deposit might be taxable.
So, what does that mean?
Let me explain you – If the total interested earned on deposit goes above Rs 10,000 then you will have to pay Tax or the Bank will automatically deduct the 10% as TDS.
However if you Tax bracket doesn’t not fall under Tax, then you can submit Form 15G that tells bank to not to deduct any TDS on Fixed Deposit.
Benefits of FD
- One of the safest Investment option available in market.
- No lumpsum, just fixed return
- No market risk
- Interest can be withdrawn on maturity or quarterly or monthly.
- Save Tax if deposits for 5 years (Terms & Conditions applicable)
Restrictions of FD
Don’t be very happy, since there are few drawbacks that you should consider while investing:
- Money blocked for certain time.
- It provide low returns
- You will have to pay tax that will ultimately reduce the overall returns
- Less liquidity.
There are other better investment opportunities available in market that can provide better returns like investment in property, land, ppf (most secured and better return than deposit) etc.
Do let me know if you have any other tips or ideas about how to get better return as compare to traditional deposit in banks 🙂