FD has been the favorite investment tool amongst Indians over the past few years. People prefer this investment plan over any other investment plan as it yields high returns at a very low-risk. By using an FD calculator, you can estimate the return that you will earn on your investment and compare it with other investment.
By investing in this plan, you can earn better interest than a saving account. The returns are assured as the interest rate is not affected by the market fluctuations. The interest rate stays steady throughout the FD tenor.
To obtain the maximum benefit of an FD scheme, you must understand the working of an FD. Also, you should know the ways to calculate the interest rate on the invested sum.
How will you calculate monthly interest?
You can calculate the interest rate using the traditional pen and paper method, or you can even use an online FD calculator. An FD calculator will provide you the speed and efficiency to do the calculations.
An FD calculator is basically an online tool to calculate the returns on the amount invested. All you need to do is feed your basic details like the principal amount, tenor and the payment frequency, to calculate the monthly interest you will earn.
Before investing, one should remember that the interest rates usually differ from bank to bank. Also, a longer maturity period will help the investor to earn higher returns as compared to a short-term investment.
How to use online fixed deposit calculators?
Using online FD calculator is easy and convenient; it gives you accurate results in the fraction of seconds. This calculator is preferred over any other tool as it eliminates the tedious manual calculations.
In order to calculate the monthly interest rate, you need to feed the following necessary details.
● Fixed deposit amount
The amount that you wish to invest in a fixed deposit scheme. This is also termed as the principal amount.
● Investment tenor
It is the period for which you want to invest your fixed deposit amount.
● Types of deposit
Here, you have two options to choose from, one is cumulative FD option, and another is non-cumulative FD option.
Once you’ve entered these details, click on the ‘calculate’ option and you will instantly receive the maturity amount and the interest that you will earn at the end of the tenor.
How can an FD calculator benefit the investor?
● Accurate results
By using an FD calculator, you can easily calculate the interest rate and can get an accurate result of the returns on invested amount.
● Convenient and accessible
To use this calculator you just have to go online and search for an FD calculator. Various sites offer the online calculator service to use for free.
● Helpful in comparison
The result that is received from this calculator can be used to compare the actual amount that an investor gets at the time of maturity.
● Estimation of the rates for different tenors
With the help of this calculator, an investor can get an estimate of the different rates that will be applicable for different tenor. This helps the investor to decide the tenor of which he can invest the amount.
The Bottom Line
Now you know that an online FD calculator is an easy tool that helps you to save time and effort and makes your calculations easier. By making calculations that are real-time, the investor can compare the returns on investment from other institutes and find out the best scheme that is offering the highest return.
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