Loading...
Loading...
Calculate exact maturity returns, cumulative quarterly interest, and annual percentage yields across public and private bank fixed deposit terms.
*Most standard commercial banks compound fixed deposits on a quarterly schedule.
Accumulated balance after 5 years at 7.25% interest.
A Fixed Deposit (FD), known as a Certificate of Deposit (CD) or term deposit in western banking, is one of the most reliable and risk-averse financial instruments available. By locking in a lump sum capital allocation for a predetermined horizon at a contracted interest rate, depositors shield their savings against volatile market downturns.
When interest is reinvested quarterly, commercial banking institutions utilize the standard periodic compound interest equation:
A common challenge with long-term fixed deposits is premature withdrawal penalty fees (typically 0.5% to 1% reduction in contract interest). To overcome this, smart investors use an FD Laddering Strategy:
Instead of depositing ₹6,00,000 into a single 3-year FD, divide it into three separate ₹2,00,000 deposits across 1-year, 2-year, and 3-year tenures.
When the 1-year FD matures, reinvest it into a new 3-year FD. When the 2-year FD matures, reinvest into another 3-year FD.
One portion of your capital matures every single year, providing cash liquidity without sacrificing the higher interest rates of long-term deposits.
Learn more about interest rate cycles, inflation preservation, and compound growth formulas from our research team.
Discover how compounding frequencies (quarterly vs monthly) dictate the effective annual yield of your fixed bank savings.
Use the investor's mental shortcut to instantly forecast how many years your fixed deposit will take to double at prevailing rates.
Understand why nominal fixed deposit rates must be evaluated against headline inflation to calculate your real post-tax purchasing power.