Fixed Deposit Calculator

A Fixed Deposit (FD), called a Certificate of Deposit (CD) in the United States, is a savings instrument where you deposit a lump sum for a fixed term at a guaranteed interest rate. At maturity, you receive your principal plus the accumulated interest.

Formulas:

Simple Interest FD: Maturity Amount = Principal × (1 + Rate × Time) Interest Earned = Principal × Rate × Time

Compound Interest FD (most common): Maturity Amount = Principal × (1 + Rate/n)^(n × t) Interest Earned = Maturity Amount − Principal

What each variable means:

• Principal (P): the amount deposited at the start.
• Rate (r): annual interest rate as a decimal (e.g., 6.5% = 0.065).
• Time (t): investment period in years.
• n: compounding frequency per year (1 = annually, 4 = quarterly, 12 = monthly, 365 = daily).

Compounding frequency effect on $10,000 at 5% for 3 years:

• Annual: $11,576.25
• Half-yearly: $11,596.93
• Quarterly: $11,607.55
• Monthly: $11,614.72
• Daily: $11,618.22

Daily beats annual by $41.97 over three years, which is 0.42% of the deposit. The calculator prints all five for whatever numbers you enter, so you can see whether a bank’s compounding frequency is worth switching for.

Worked example: Deposit ₹1,00,000 in a bank FD at 7.5% per annum, compounded quarterly, for 2 years.

n = 4, t = 2, r = 0.075 Maturity = 1,00,000 × (1 + 0.075/4)^(4×2) = 1,00,000 × (1.01875)^8 = 1,00,000 × 1.1602217 = ₹1,16,022

Interest Earned = ₹16,022

Run that exact set of inputs above with the currency set to rupees and you get ₹1,16,022.17. The factor matters to five decimals here: rounding (1.01875)^8 to 1.16 instead of 1.1602217 loses ₹22 on a one-lakh deposit, and proportionally more on a larger one.

Simple interest deposits still exist. Some short-tenure and non-cumulative deposits pay simple interest, where the maturity value is Principal × (1 + Rate × Time) and nothing compounds. On the example above that would be 1,00,000 × (1 + 0.075 × 2) = ₹1,15,000, about ₹1,022 less. This calculator models the compound form, which is what almost every cumulative bank FD uses.

Tax note: In India, TDS (Tax Deducted at Source) of 10% applies if interest exceeds ₹40,000 in a year. In the United States, CD interest is fully taxable as ordinary income in the year it is earned, even if you do not withdraw it.