Interest Calculator SBI FD

SBI Fixed Deposit Formula:

\[ A = P \times (1 + R / n)^{n \times T} \]

Principal Amount (P):

INR

Annual Interest Rate (R):

decimal

Compounding Frequency (n):

Time Period (T):

years

Maturity Amount (A):

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1. What is the SBI FD Interest Formula?

The SBI Fixed Deposit formula calculates the maturity amount using compound interest principles. It determines how much your investment will grow over time with regular compounding at specified intervals.

2. How Does the Calculator Work?

The calculator uses the compound interest formula:

\[ A = P \times (1 + R / n)^{n \times T} \]

Where:

\( A \) — Maturity amount (INR)
\( P \) — Principal investment amount (INR)
\( R \) — Annual interest rate (decimal)
\( n \) — Compounding frequency per year
\( T \) — Time period in years

Explanation: The formula calculates how your principal grows with compound interest, where interest is added to the principal at regular intervals, earning more interest in subsequent periods.

3. Importance of FD Calculation

Details: Accurate FD calculation helps investors plan their savings, compare different investment options, and understand the power of compound interest for long-term wealth creation.

4. Using the Calculator

Tips: Enter principal amount in INR, annual interest rate as decimal (e.g., 0.075 for 7.5%), select compounding frequency, and time in years. All values must be positive.

5. Frequently Asked Questions (FAQ)

Q1: What is the minimum investment for SBI FD?
A: The minimum investment for SBI fixed deposits is typically ₹1,000 for regular citizens and ₹1,000 for senior citizens.

Q2: Are SBI FD returns taxable?
A: Yes, interest earned on SBI FDs is taxable as per your income tax slab. TDS is deducted if interest exceeds ₹40,000 (₹50,000 for senior citizens) in a financial year.

Q3: What are the tenure options for SBI FD?
A: SBI offers FD tenures ranging from 7 days to 10 years, with varying interest rates for different tenure periods.

Q4: Can I withdraw my FD prematurely?
A: Yes, but premature withdrawal may attract a penalty of 0.5-1% on the interest rate, depending on the tenure and terms.

Q5: How does compounding frequency affect returns?
A: Higher compounding frequency (monthly vs annually) results in slightly higher returns due to more frequent interest calculations and compounding.