About this calculator
Enter the deposit, the rate and the tenure, and choose how often interest is compounded. The calculator gives the maturity amount, the interest earned and the effective yearly yield, which lets you compare FDs that compound differently.
How to use it
- Enter the amount you will deposit.
- Enter the rate offered for your tenure. Senior citizen rates are usually higher; use the rate that applies to you.
- Enter the tenure in years and months.
- Leave compounding on quarterly unless your bank says otherwise.
The formula
- A
- the maturity amount
- P
- the amount deposited
- r
- the yearly interest rate as a decimal (7% = 0.07)
- k
- compounding periods per year: 12, 4, 2 or 1
- t
- the tenure in years (18 months = 1.5)
Worked example
₹2 lakh for 3 years at 7.25%, compounded quarterly
- P = ₹2,00,000, r = 0.0725, k = 4, t = 3, so k × t = 12 quarters.
- (1 + 0.0725 ÷ 4)12 = 1.01812512 = 1.24055.
- A = 2,00,000 × 1.24055 = ₹2,48,109.
- Interest earned = ₹48,109. The effective yearly yield is 7.45%, higher than the 7.25% quoted, because of quarterly compounding.
What the result means
The maturity amount is what the bank pays at the end, before any tax deducted at source. The effective yield tells you what the deposit really earns in a year once compounding is counted, so it is the fairer number for comparing two banks.
FD interest is taxable as income in the year it accrues, even in a cumulative FD where you receive nothing until maturity. Banks deduct TDS when interest crosses the threshold in force, unless you have submitted the declaration form that applies to you.
Assumptions
- The rate stays fixed for the whole tenure, as it does on a normal bank FD.
- Interest is compounded at the frequency you choose and reinvested until maturity.
- No premature withdrawal.
Limitations
- Banks calculate part-periods on a day basis, and many pay simple interest on deposits shorter than six months. Results for odd tenures can differ slightly from the bank’s figure.
- TDS and income tax are not deducted.
- Non-cumulative FDs that pay interest out every month or quarter do not compound, so they earn less than shown here.
- Breaking an FD early usually carries a penalty of a lower rate, which is not modelled.
Frequently asked questions
Why is the effective yield higher than the FD rate?
Because interest added each quarter starts earning interest itself. A 7% rate compounded quarterly is equal to about 7.19% compounded once a year.
Is FD interest taxable?
Yes. It is added to your income and taxed at your slab rate. Deposits in the 5-year tax-saving FD may qualify for a deduction under the old tax regime, depending on the rules in force.
How much does compounding frequency matter?
Less than people expect. On ₹1 lakh at 7% for 5 years, monthly compounding gives about ₹1,41,763 and yearly compounding about ₹1,40,255. The rate and the tenure matter far more.
Is my FD safe?
Deposits in banks are insured by DICGC up to the limit in force per depositor per bank, covering principal and interest together. Company FDs and some NBFC deposits are not covered.
For information only. This calculator gives estimates based on the figures you enter and the assumptions listed above. It is not financial advice. Actual amounts depend on the lender’s or institution’s terms, fees, rounding and rate changes. Please confirm with them before you decide.
Last reviewed on 29 September 2026. Found a mistake? Tell us.