What is a FD Interest Calculator & What are the Benefits of Using it?
A fixed deposit is one of the safest investment options that exists. You invest a particular sum of money, for a fixed sum of interest over a period of time, and on completion, you get a lumpsum amount that’s a combination of the principle, and interest accumulated over that period. To help you make the best of your FD deposit, it’s best to look up an FD interest calculator that can help you determine the amount of interest and the final lumpsum amount that you can get for the investment you make. It’s a handy tool, that’s freely available across all major banks, and helps you compare the interest rates and the duration that you need to stay invested to get the maximum out of your investment.
What is An FD Calculator?
An FD interest calculator is a handy tool helping you calculate the rate of interest that you can get on your investment. It’s a simple and efficient tool that lets you make a comparison across banks for the same amount of investment across your chosen duration so that you can get maximum returns at maturity. This helps you chose a bank that offers you more interest on your investment. The FD calculator makes this distinction between banks by factoring in the principal amount, term, and the prevalent interest rates at the time, so that you are able to make an informed decision before investing your hard-earned money into a fixed deposit account.
How Fixed Deposit is Calculated?
Calculating the FD interest using the FD calculator online involves a very simple process, here are the steps to know how fixed deposit is calculated:
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First, you need to choose the category of citizen you fall under, i.e., whether you are a senior citizen or a non-senior citizen
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Choose your Fixed deposit, for e.g., cumulative, or non-cumulative
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Choose the amount for your fixed deposit
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Choose the duration of the deposit
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Input any other additional details as needed in to the FD calculator
Once all details have been filled correctly, the FD interest calculator will display the amount of interest and the total amount that you can expect to receive at the end of the FD tenure.
Benefits of Using an FD Calculator
There are many benefits to using an FD interest calculator while comparing interest rates across banks, so that you can best plan your investment to meet the financial goals of the future. Let’s have a brief look at few of the most prominent benefits of using this calculator online.
Simplifying Investment Calculations
Unless you a number cruncher, it can be difficult to manually calculate the returns you will get on maturity across banks as it’s a complicated process that requires factoring in multiple parameters. An FD interest calculator simplifies this process by automating the entire process; thereby, reducing the human effort, and time it would otherwise take to make this distinction.
Evaluate Associated Risks
Since you are able to clearly approximate the returns that you can expect from your FD account on maturity, it helps you evaluate your earnings based on your risk appetite. Moreover, if you happen to have a low appetite for risk taking, it can help you decide on the amount and the tenure to meet your specific financial goals.
Save time
This one’s a no-brainer! The automated process of an FD calculator can help shave hours off the entire process of calculating returns. Moreover, human effort is reduced to only entering a few details and you can leave the rest to the calculator.
Comparison Across Banks and FD Programs
It’s almost impossible to compare multiple plans across banks manually as it would take hours to make that kind of a comparison considering the fact that there are literally hundreds of banks offering multiple plans with varies interest rates. By using an FD interest calculator, you can quickly lookup hundreds of plans in the shortest amount of time to figure out the plans that best synch with your financial goals.
Helps you Make an Informed Decision
Any financial decisions that you take should be based on logic, and facts. Therefore, it’s crucial to have an idea on the returns you can expect from a particular plan so that you can plan your future finances betters. Moreover, it can help you plan any further investments that you need to make in order to fulfill those goals as you can get a clear picture on the returns on investment from your FD account and plan accordingly by diversifying your portfolio.
As you can see it’s super simple to use, and the benefits it offers is incredible. So, if you are interested in opening an FD account and have been struggling to find the most appropriate FD plan; Max Life Insurance offers a handy FD interest calculator that gives you simplified results across multiple FD plans to help you choose the most ideal plan for yourself.
So, if you have been struggling to figure things out, now you know what you need to do!
