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Fixed Deposit Monthly Interest Formula:
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Fixed Deposit Monthly Interest Calculation determines the interest payout received each month from a fixed deposit investment in Indian banks. This helps investors plan their monthly income from FD investments.
The calculator uses the formula:
Where:
Explanation: The formula calculates the monthly interest by dividing the annual interest by 12 months. The principal is multiplied by the annual rate (converted to decimal) and then divided by 12.
Details: Calculating monthly interest helps investors understand their regular income from fixed deposits, plan monthly budgets, and compare different FD schemes offered by various banks in India.
Tips: Enter principal amount in INR and annual interest rate in percentage. All values must be valid (principal > 0, rate > 0). The calculator will compute the monthly interest payout.
Q1: Is the monthly interest calculation accurate for all FDs?
A: This calculation provides an estimate. Actual payouts may vary based on bank policies, compounding frequency, and tax deductions at source (TDS).
Q2: Are there any taxes on FD interest income?
A: Yes, interest income from fixed deposits is taxable as per your income tax slab. Banks also deduct TDS if interest exceeds ₹40,000 (₹50,000 for senior citizens) annually.
Q3: Can I get monthly interest payout from all FDs?
A: Most banks offer monthly interest payout options, but the interest rates may be slightly lower compared to quarterly or cumulative payout options.
Q4: How does compounding affect monthly interest?
A: This calculator assumes simple monthly payout. For compounded FDs, the calculation would be different as interest earns additional interest.
Q5: What's the minimum deposit for monthly interest FDs?
A: Minimum deposit requirements vary by bank, but typically start from ₹5,000 to ₹10,000 for monthly interest payout FDs.