Do you have underlying capital? Invest your idle capital in fixed deposits now and get a return on it! Fixed deposits offer an attractive and apt rate of interest, which is insured by the government, making them highly safe and secure. Also, they are a good option if your savings are lying at home as they give you the chance of earning profit and building up your savings.
Fixed deposits are a safe and secure option for investing if you are a risk-averter because the FD interest rate offered is predetermined and is not affected by market fluctuations.
What is a Fixed Deposit?
A fixed deposit is an investment instrument that allows you to invest safely by depositing a fixed amount on a predetermined interest rate for a fixed time. It offers a comparatively higher interest rate than a savings account.
You can also decide which fixed deposit to invest if you calculate FD interest using a calculator, which makes calculation easy and effective and helps you make an informed decision based on comparative analysis of different interest rates, tenures, and the principal amount to be deposited.
What is an FD calculator?
It is a tool that helps you decide which FD to invest in by comparing different interest rates, terms, and the principal amount to be paid, as the compound interest rate calculation is complex. FD calculator simplifies the process for you.
What is the significance of using an FD calculator?
- Comparison and choice
You can compare and make a detailed analysis of different fixed deposits various financial institutions offer and make an informed decision.
- Accurate and precise
The results you get after using a calculator are accurate, eliminating the chances of human error and precisely calculating, as their algorithms are pretty advanced.
The calculation time is significantly less when using a calculator than the time taken in human calculation, saving time and effort.
It helps you evaluate your chosen investment plan and calculates your maturity amount based on your risk appetite. You can, therefore, change your decision based on the calculated values if it does not match your financial goals.
- Easy and convenient
With the help of a calculator, you can calculate FD interest rate easily at the convenience of your home and need not visit any financial institution, avoiding all the hassle.
How do banks calculate interest on FD in India?
Banks have different schemes for customers like senior citizens and customers below age 60, calculating interest rates using a calculator.
Some banks offer simple interest rates, and some offer interest compounding based on factors like tenure and the respective plan.
Following are the two ways by which banks calculate interest rates:
- Simple interest
Fixed Deposit Maturity Amount= Principal Amount + ( Principal *Rate of Interest*Time Period)/ 100)
- Compound interest
A = P(1 + r/n)^nt; where A stands for the amount of money accumulated, P is the principal; that’s the amount you start with. The r is the interest rate. The n is the number of times the interest rate compounded annually, and t is the time in years of the deposit or borrowed money.
Which is the best app for investing in FD?
I use the Bajaj Finserv calculator as it is the best FD calculator in India; it offers instant, accurate and reliable results. They have a user-friendly interface, and their app is accessible, easy to understand, and easy to use. Make your investment journey simple with them!
Investing your capital is crucial to building and maintaining your financial health. It forms a good habit of constantly investing your idle money, thus giving you return benefits and elevating your savings. Fixed deposits are the best option to begin your investment journey with.