Most banks and non-banking financial Companies (NBFC) provide fixed deposits (FDs). Fixed deposits have a variable period, returns, and a predetermined interest rate. Regardless of market volatility, you will always receive the predetermined interest on your FD investment. Tenure options for investments range from seven days to ten years.
An investor can estimate the FD maturity amount for a specified tenure using the fixed deposit calculator. Before investing, you can calculate the interest income using an FD calculator. The investment amount, current interest rate, and tenure are entered into the FD calculator. The output is the amount of wealth accrued at maturity.
The fixed deposit calculator merely estimates wealth gained; it makes no guarantees about the value calculated based on the supplied inputs. To assess the maturity of an FD, use the user-friendly and straightforward online FD calculator provided by financial institutions, such as SBI.
Before investing, an investor must be aware of the due amount. This will guarantee that the investment opportunity chosen will meet the investor’s financial aim at maturity.
FD calculators use different methods. The SBI’s FD calculator offers the “investment amount method” and “target amount method”.
You can calculate the investment required to reach the target maturity amount using the target amount approach. Then, all you are left to do is fill in the information about your investment objective as described in the process below:
Based on the previously mentioned information, the online FD calculator will tell you how much money you need to invest to receive the specified maturity amount. Also, the interest amount will be paid on the investment.
The Fixed Deposit Investment Graph is another resource you can use. Additionally, you can download the investment report to get a complete breakdown of the periodic dividend. You can get them monthly, quarterly, half-yearly, and annual.
The bank’s interest rate on the fixed deposit is already known when the investment is made. But, the specified deposit interest rates are influenced by a few things, some of which are listed below:
Simple interest = (P * R * T)/100
P – Invested principal amount
R: Interest rate ( percent )
Mr. Arun made a 10-year investment of INR 100,000 at a rate of interest of 5%.
Simple Interest is calculated as (100,000 * 5 * 10)/100 to equal INR 50,000
The P is INR 100,000.
The R is 5%.
The T is 10 years.
Simple Interest + Principal = Maturity Value.
= INR 100,000 + INR 50,000
= Rs 150,000
He will have ₹150,000 at the end of his investment period of 10 years.
The accrued interest increases with the number of years over which interest compounds.
A = P (1+r/n) ^ (n * t)
A = Maturity amount
P = The invested principal
r = Interest rate in decimals
n = The number of compounding periods in a year
t = The number of years
Mr. Arun invested INR 100,000 for 10 years at an interest rate of 5% per annum compounded quarterly
In this case, the principal amount invested is INR 100,000.
The interest rate is 5%.
The number of compounding periods in a year is 4, as the interest is compounded quarterly.
The number of years of investment is 10 years
A = 1,00,000* (1+0.05/4) ^ (4*10)
A i.e. maturity amount = INR 1,64,362
Interest amount accrued = INR 1,64,362 – INR 1,00,000 = INR 64,362
You should only invest in any plan after conducting a careful analysis and investigation. The investment strategy must meet your investing goals. You must utilize a calculator to determine whether the investment strategy satisfies your investment goals. By doing so, you will avoid any regrets and surprises in addition to making an informed selection. Once an investor has a particular financial objective in mind, they may choose which investment strategy to go with.
Banks offer online FD calculators. For instance, SBI offers a straightforward yet valuable online FD calculator to assist you in making an investment choice.
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