Fixed Deposit Interest Rates Calculator

What is a Fixed Deposit or FD Calculator?

Fixed deposits are a great investment tool for the risk-averting traditional customer. They encourage a healthy saving habit too and provide a healthy liquidity option if any need for the same should arise. Before going for a fixed deposit account opening, one should pay attention to the rates offered by the bank on the specific fixed deposit scheme. Using the values of the rates and the amount to be kept in the fixed deposit, the fixed deposit calculator can help in finding out the return on investment after the intended period of lock-in has been completed.

Benefits of Fixed Deposit Calculator

As a tool that requires basic inputs of tenure, rate and investment amount, a fixed deposit calculator can provide advantages as follows –

  1. Accessibility – The fixed deposit calculator is a tool that can run on most web browsers and is lightweight enough to be operated on even the lowest bandwidth available
  2. Economical – The tool itself is free and helps one to choose the best fixed deposit scheme available by providing the return value at a moment’s glance
  3. Timely – The calculator is very simple to use and additionally, once a specific set of schemes are initially chosen, one can quickly compare among them without having to bother with information seeking from persons

Computation Factors in Fixed Deposit Calculator

The basic inputs in the fixed deposit calculator would be the following –

  1. Principal – The initial amount to be put into the fixed deposit account
  2. Tenure – The period for which the fixed deposit is to be maintained with the bank, could be as low as a day or even more than 4 years as per the bank’s guidelines
  3. Rate of Interest – The rate of interest offered by the bank, can vary as per the tenure of the deposit
  4. Frequency – The regularity as per which the interest is calculated based on the interest rate provided by the bank and it could be simple, compounded monthly, compounded quarterly, compounded half-yearly or compounded yearly

Using a Fixed Deposit Calculator

As mentioned above, the calculator needs inputs in order to calculate the return that will be made available to the customer while at maturity or when the fixed deposit tenure ends normally. It is worthwhile to note that the values indicated by the calculator hold good only if the fixed deposit is not terminated prematurely.

If a principal amount of AED 150,000 is kept in a fixed deposit account for a period of 2 years, at a rate of 1% interest compounded quarterly, the interest on the principal amount would be something to the tune of AED 3,027 and the total return would thus be AED 153,027.

Based on the rates offered by the bank and the frequency of interest calculation, the values could change.

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