Interest Calculator On FD Bank Of India

Fixed Deposit Formula:

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

Principal Amount (P):

₹

Annual Interest Rate (r):

Compounding Periods (n):

Time Period (t):

years

Future Value (A):

Interest Earned:

Unit Converter ▲

Unit Converter ▼

From:	To:

1. What is the Fixed Deposit Interest Formula?

The compound interest formula calculates the future value of a fixed deposit investment. It takes into account the principal amount, annual interest rate, compounding frequency, and time period to determine the total maturity amount.

2. How Does the Calculator Work?

The calculator uses the compound interest formula:

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

Where:

\( A \) — Future value of the investment
\( P \) — Principal investment amount
\( r \) — Annual interest rate (in decimal)
\( n \) — Number of times interest is compounded per year
\( t \) — Time the money is invested for (in years)

Explanation: The formula accounts for the effect of compounding, where interest is earned on both the principal and accumulated interest.

3. Importance of FD Interest Calculation

Details: Accurate interest calculation helps investors plan their finances, compare different FD schemes, and make informed investment decisions to maximize returns.

4. Using the Calculator

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

5. Frequently Asked Questions (FAQ)

Q1: What is the difference between simple and compound interest?
A: Simple interest is calculated only on the principal amount, while compound interest is calculated on both the principal and accumulated interest, leading to higher returns.

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 to the principal more often.

Q3: Are FD interest rates fixed for the entire tenure?
A: Yes, Bank of India FD rates are typically fixed at the time of investment and remain constant throughout the deposit tenure.

Q4: What is the minimum investment amount for Bank of India FD?
A: The minimum investment amount varies by bank and FD scheme, typically starting from ₹1,000 for regular fixed deposits.

Q5: Are there tax implications on FD interest?
A: Yes, FD interest is taxable as per your income tax slab. TDS may be deducted if interest exceeds ₹40,000 (₹50,000 for senior citizens) in a financial year.