IOB FD Calculator

The IOB FD calculator is an online financial tool that can help you calculate the maturity amount for your fixed deposit based on the prevailing interest rate for a particular tenure. The calculator is simple to use and helps you compare different tenures with various interest rates from different banks. This makes it easy for you to decide which bank you should choose to start your fixed deposit journey.

A fixed deposit (FD) is an investment scheme, where you invest a lump sum amount with a bank or NBFC (Non-Banking Financial Company) for a specified period. At the end of the tenure, the financial institution will return your principal investment amount as well as the interest accumulated up until that point.

There are several types of fixed deposits offered by financial institutions in the country. We are going to take a look at two of them: non-cumulative fixed deposit (simple interest) and cumulative fixed deposit (compounding interest).

In a non-cumulative FD, the investor can choose the payout frequency. The interest on the non-cumulative FD can be received every month, every quarter, every six months, or every year. On the other hand, in a cumulative FD, the interest is compounded each year and paid at maturity.

How Does The IOB Fixed Deposit Calculator Work?

The fixed deposit calculator uses the below formula to calculate your payout amount and maturity amount.

Where,

M is the Maturity amount
P is the Principal amount
r is the rate of interest per annum
t is the tenure in years

Where,

M is the Maturity amount
P is the Principal amount
r is the rate of interest per annum
n is the compounding frequency
t is the tenure in years

Example:

Mr. Chandrashekar is looking to invest ₹4.5 lakhs in a fixed deposit. The interest rate on the FD is 7%. The tenure of the FD is 4 years. He wants to receive his payout every year. This is how we can calculate his yearly payout amount using the simple interest formula.

M = P + (P x t x r/100)
M = 4,50,000 + (4,50,000 x 7 x 4 / 100)
M = 4,50,000 + 1,26,000
M = 5,76,000

Interest = 5,76,000 - 4,50,000
Interest = 1,26,000
Interest payable every year = 1,26,000 / 4 = 31,500

So, if Mr. Chandrashekar invests ₹4.5 lakhs in an FD at an interest rate of 7% for a tenure of 4 years and chooses a yearly payout, he will receive ₹31,500 every year. He will also receive the principal amount of ₹4.5 lakhs at the end of the tenure.

If Mr. Chandrashekar invests the same amount in a cumulative FD, this is how much he will receive at the end of the tenure.

M = P (1 + r/n) ^ (n x t)
M = 4,50,000 (1 + 0.07)^(1 x 4)
M = 4,50,000 x (1.07)^4
M = 4,50,000 x 1.31079601
M = 5,89,858.2045 (approximately)

So, if Mr. Chandrashekar invests ₹4.5 lakhs at an interest rate of 7% for a tenure of 4 years, you will receive around ₹5.89 lakhs as his maturity amount.

How To Use The IOB Fixed Deposit Calculator?

You can use the fixed deposit calculator to calculate the interest and maturity amount on the FD as follows:

• Select the type of fixed deposit - Annual or cumulative payout.
• Enter the deposit amount you are planning to put in the FD.
• Type in the interest rate you will receive for your amount.
• Mention the tenure of the deposit.

Once the details are entered, the calculator will show you the payout amount or maturity amount.

Benefits Of Using The Fixed Deposit Calculator

There are several advantages of using the IOB FD calculator such as:

• The fixed deposit calculator helps you calculate the maturity amount accurately so that you can choose the best tenure for your deposit.
• The calculator helps you compare interest rates from different banks and choose the best interest rate for your deposit.
• The calculator ensures accurate calculations every time and avoids mistakes.
• You can use the calculator to calculate maturity amounts much faster than using a spreadsheet.