HDFC FD Calculator
The HDFC FD calculator allows you to understand how much returns you will be making on your investment in fixed deposits. To know the return on your investment, you need to calculate the compound interest amount, which involves complicated calculations. This can be challenging to do manually but the online calculator can complete this calculation in a few seconds.
A fixed deposit is a type of deposit in which a sum of money is locked for a fixed period. The investor can decide the tenure of their fixed deposit. The tenure can be anywhere between a few days to several years. The bank or NBFC (Non-Banking Finance Company), where the investor puts their money, offers a fixed rate of interest to investors for putting their money for a certain period.
There are different types of fixed deposits, such as non-cumulative fixed deposits and cumulative fixed deposits. In non-cumulative FD, investors can choose to receive their interest income periodically, like every month, every quarter, every six months, or every year. However, in cumulative FDs, you can receive your principal amount and interest amount at the end of the FD tenure.
How Does The HDFC Fixed Deposit Calculator Work?
The below formula is used to calculate the maturity amount for non-cumulative FDs (simple interest):
Where,
M is the Maturity amount
P is the Principal amount that you deposit
r is the rate of interest per annum
t is the tenure in years
The below formula is used to calculate the maturity amount for cumulative FDs (compounding interest):
Where,
M is the Maturity amount
P is the Principal amount that you deposit
r is the rate of interest per annum
n is the number of times the amount is compounded
t is the tenure in years
Example:
Mr. Eshwar is looking to start a fixed deposit for an amount of ₹12 lakhs. The interest rate of the FD is 7%. The tenure of the FD is 5 years. Using the simple interest formula, let’s calculate the maturity amount and how much he will receive every six months.
M = P + (P x t x r / 100)
M = 12,00,000 + (12,00,000 x 5 x 7/100)
M = 12,00,000 + (12,00,000 x 5 x 0.07)
M = 12,00,000 + 4,20,000
M = ₹16,20,000
Interest = 16,20,000 - 12,00,00
Interest = ₹4,20,000
Interest payable every 6 months = 4,20,000 / 10 = ₹42,000
So, if Mr. Eshwar invests ₹12 lakhs in fixed deposit at an interest rate of 7% for a tenure of 5 years, his total maturity amount will be ₹16,20,000 and he will receive ₹42,000 every 6 months. He will also receive the principal amount of ₹12 lakhs at the end of the tenure.
If Mr. Eshwar invests the same amount in a cumulative FD, here’s how much she will earn.
M = P (1 + r/n) ^ (n x t)
M = 12,00,000 (1 + 0.07/1)^(1 x 5)
M = 12,00,000 x (1.07)^5
M = 12,00,000 x 1.4025517307
M = ₹16,83,062 (approximately).
So, if Mr. Eshwar invests ₹12 lakhs in an FD, earning an interest of 7% for a tenure of 5 years, he will earn a maturity amount of around ₹16.83 lakhs.
How To Use The HDFC Fixed Deposit Calculator?
You can use the calculator to better plan your finances. All you need to do is to follow these steps:
- Choose whether you need to receive an annual payout or the amount at maturity.
- Enter the amount you wish to deposit.
- Specify the rate of interest.
- Finally, mention the tenure of the FD.
Once the details are entered, the calculator will tell you the results in a matter of seconds.
Benefits Of Using The HDFC Fixed Deposit Calculator
Using the HDFC fixed deposit calculator is easy. Here’s how you can use it properly.
- By giving you accurate results, the FD calculator helps you make informed investment decisions.
- The FD calculator helps you choose the best tenure to achieve your desired returns.
- The calculator enables you to get accurate results so that you can understand how much money you should be investing to achieve the amount you desire.