1. What is the FD Interest Calculation Formula?

The compound interest formula calculates the maturity amount for a fixed deposit investment. It accounts for the principal amount, annual interest rate, compounding frequency, and time period to determine the final amount you will receive.

2. How Does the Calculator Work?

The calculator uses the compound interest formula:

Where:

• \( A \) — Maturity amount (₹)
• \( P \) — Principal amount (₹)
• \( r \) — Annual interest rate (decimal)
• \( n \) — Compounding frequency per year
• \( t \) — Time period in years

Explanation: The formula calculates how your investment grows over time with compound interest, where interest is earned on both the principal and accumulated interest.

3. Importance of FD Interest Calculation

Details: Accurate FD interest calculation helps investors plan their finances, compare different investment options, and understand the potential returns from their fixed deposit investments with Federal Bank.

4. Using the Calculator

Tips: Enter the principal amount in rupees, annual interest rate as a percentage, select compounding frequency, and time period in years. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What is compound interest?
A: Compound interest is interest calculated on both the initial principal and the accumulated interest from previous periods.

Q2: How does compounding frequency affect returns?
A: More frequent compounding (monthly vs annually) results in higher returns due to interest being calculated and added more often.

Q3: Are there any taxes on FD interest?
A: Yes, interest earned on fixed deposits is taxable as per your income tax slab. TDS may be deducted by the bank.

Q4: What is the minimum investment for Federal Bank FD?
A: Please check with Federal Bank for current minimum investment requirements as they may vary.

Q5: Can I withdraw my FD before maturity?
A: Premature withdrawal is usually possible but may involve penalty charges and reduced interest rates.