FD interest rate and tenor hardly give you a clear indication about returns, maturity amount and growth trajectory on your FD investment. So, if you want to calculate the interest earnings and return on your own, how would you go about it?
Well, there are two ways:
Manual
The manual way comprises doing calculations on paper, scientific calculator or a spreadsheet. You need to apply a mathematical formula for this.
The formula will be:
A = P (1 + r/n) ^ (nt)
where,
A is Maturity Amount
P is Deposit Amount
r is Rate of Interest
n is Compounded Interest Frequency
t is Tenor
Example:
Let’s say, you want to invest Rs. 1,00,000 at 8% interest rate for 5 years at quarterly compounding frequency. Based on the formula, the calculation will be:
A=1,00,000(1+0.08/4) ^ (4*5) = Rs1,48,595
Since the compounding frequency is quarterly, the formula uses ‘4’ in ‘n’ position. The assumption is that interest will be compounded four times a year every quarter.
Sound complicated, right? Just imagine the complexity if you have to calculate it for monthly returns or multiple FDs!
Moreover, the manual mathematical formula gives only rough estimates. Hence, it is always advisable to use online FD return calculator.
Online FD Calculator
An online FD calculator automatically calculates everything right from total interest payout to total maturity amount and even maturity date. The benefits of online FD return calculator are:
- Quick calculations
- Accurate results
- Comparison of returns across all FD issuers.
- Comparisons of returns across varying tenor and interest payment frequency.
- Informed investment decision
- Free of cost
It is recommended that you choose a reliable online FD calculator such as that available on Bajaj Finance website. You simply need to choose your customer status (new, existing, senior citizen or Bajaj employee), deposit amount and tenor. It will quickly populate total interest payout, maturity date and total maturity amount.
If you have opted for monthly, quarterly, half-yearly or yearly payouts, Bajaj FD calculator monthly interest will calculate returns accordingly. This feature is especially useful for senior citizens and people looking for regular cash flow.
While using Bajaj Finance FD calculator, you might want to check its ongoing interest rate. It is currently offering a high interest rate up to 7.35% and an additional 0.10% if you book an online FD. With falling interest rates and ongoing market fluctuations, you may want to invest in Bajaj Finance FD and lock the current high interest rate.
You can also use the online FD calculator to calculate the maturity value of your investment and accordingly decide if you’d like to opt for a loan against FD, in times of financial emergencies. Most lenders offer loan up to 75% of the value of your fixed deposit investment.
Manual mathematical formula and online FD return calculator are two ways to estimate your earnings from FD. The online FD calculator is simpler and more reliable than the manual one. The results are also very precise with online FD calculator. It helps you to make a planned FD investment based on your short-term and long-term financial goals. Bajaj Finance’s online FD calculator is among the few accurate ones in the market. It also doubles up as FD calculator monthly interest tool when you want to estimate earnings as per monthly, quarterly, half-yearly or yearly payouts.
