A fixed deposit is one of the safest financial instruments offered by banks, post offices, and finance companies. Determining the returns of an FD is possible because it is locked in for a fixed period and at a fixed interest rate.
An FD maturity calculator is provided by most financiers these days to make the calculation of returns easy. Using an FD calculator to calculate interest earnings and final returns is recommended because it eliminates the risk of errors that are associated with manual calculation.
What is an FD Calculator and how to use it?
- An FD Calculator is an online tool that helps you to calculate the returns you would be getting once your FD matures.
- With the help of an FD calculator, you can understand the benefits of fixed deposit conveniently as it helps you to compare different FD plans and allows you to plan your finances accordingly.
To start using it to your benefit you must first follow and learn these basic steps:
Step 1: Choose a financier
After finalizing the FD plan you are interested in, you can visit the official website of the financier.
Step 2: Go to the page of ‘FD Calculator’
Once you visit the customer portal, you will have to find the page that contains this calculator. After finding it, please click on it and read the instructions that are provided.
Step 3: Provide necessary details
Now, you will have to provide the necessary details like your customer category, amount, tenor, FD type (cumulative or non-cumulative), etc. and the calculator will automatically pick an FD interest rate based on the details provided by you.
Selecting the customer type is crucial as it determines the interest rate you are eligible for. For example, Bajaj Finance offers a 0.25% extra FD interest rate to senior citizens and this can create a good difference in the final maturity amount.
Picking the appropriate FD type is also important because the interest method calculation depends on it.
Step 4: Check the results
Once you provide the necessary details the FD calculator will display the interest earnings and final returns. You can experiment with different tenors or deposit amounts if you are not satisfied with the returns.
Bajaj Finance offers interest rates up to 7.35% on its FD plans which is one of the best FD interest rates in 2020. You also get an FD calculator that displays the returns of both FD types (cumulative and non-cumulative) simultaneously. This helps you to make a well-informed decision.
Also, you can invest in its SDP (Systematic Deposit Plan) if you prefer to benefit from monthly deposits in a disciplined way. The deposit amount can be Rs. 5000 and you will get two choices when it comes to tenor. You can make 6 to 48 deposits and choose a fixed tenor (from 12 to 60 months) for each one of them so that each of the deposits mature at every subsequent month. Or else, you can choose to receive all the maturity proceeds on a single date. In this case, the tenor of subsequent monthly deposits will be lesser than the first deposit as all of them mature on the same day. You can also use the SDP calculator to check your returns post maturity.
Fixed deposits are safe as their interest rates remain fixed even during changing market conditions. The fixed interest rate of a fixed deposit plan also allow you to predict the interest gains post maturity with the help of an FD calculator. An FD maturity calculator is a tool that calculates the returns based on the values like amount, tenor, etc. that you provide to it. It makes a comparison between FD plans easily. Bajaj Finance offers an interest rate of 7.35% which is higher than most bank FD rates. It also provides an FD calculator that enables you to compare FD types easily. Moreover, you can also invest in an SDP to benefit from monthly deposits.
Gaurav Khanna is an experienced financial advisor, digital marketer, and writer who is well known for his ability to predict market trends. Check out his blog at HighlightStory.