What is a Fixed Deposit (FD)?

A Fixed Deposit is a safe financial instrument provided by banks and NBFCs where you invest a lump sum for a fixed tenure at a guaranteed interest rate. It is generally safer than market-linked investments.

How is FD interest calculated?

Most banks in India use quarterly compounding for FDs. The formula is A = P(1 + r/n)^(nt), where n is 4 (quarterly).

What is the difference between Cumulative and Non-Cumulative FD?

In a Cumulative FD, interest is reinvested and paid at maturity. In a Non-Cumulative FD, interest is paid out at regular intervals (monthly, quarterly, or annually).

Is FD interest taxable?

Yes. Interest earned on FDs is taxable as per your income tax slab. Banks may also deduct TDS (Tax Deducted at Source) if the interest exceeds a certain threshold (typically ₹40,000 for regular individuals).

FD Calculator — Fixed Deposit Interest & Maturity

An FD Calculator is a financial utility used to determine the maturity value and interest earned on a lump sum investment over a fixed tenure. Use OrangeTool to plan your savings with 100% privacy and accuracy—no data ever leaves your device.

Investment Amount (₹)

Interest Rate (% P.A.)

Tenure (Years)

🏦 Accurate — uses standard quarterly compounding 🔒 Private — your savings data stays on your device 📊 Comparison — see principal vs. interest growth 📅 Last updated: May 2026

Understanding Fixed Deposits (FD)

A Fixed Deposit is a popular low-risk investment where you "lock" a specific amount of money with a bank or financial institution for a set period. In exchange, the bank pays you a guaranteed interest rate that is typically higher than a standard savings account. FDs are ideal for conservative investors looking for capital preservation and guaranteed returns.

How FD Maturity is Calculated

Most Indian banks calculate FD interest using quarterly compounding. This means interest is calculated every three months and added back to your principal, so you earn interest on interest. The formula used is:

            A = P [1 + r/n] ^ (nt)
        

Where:

A: Maturity Amount
P: Principal Amount invested
r: Annual interest rate (decimal)
n: Number of times interest compounds per year (n=4 for quarterly)
t: Total tenure in years

Cumulative vs. Non-Cumulative FDs

When opening an FD, you usually have two choices for how interest is handled:

Cumulative: Interest is compounded quarterly and paid only at the end of the tenure. This results in a higher final amount.
Non-Cumulative: Interest is paid out at regular intervals (monthly or quarterly). This is best for retirees or those needing a regular income stream. Note: Our calculator currently focuses on Cumulative FD returns.

Privacy and Financial Planning

Planning for your future requires entering details about your hard-earned savings. Most online FD calculators are "lead generators" that capture your investment interest and sell your contact information to third-party brokers. OrangeTool is different. Our logic is 100% client-side. We don't have a database for your inputs, and your financial data is never transmitted over the internet. You can plan your wealth with complete peace of mind.

Frequently Asked Questions

Can I withdraw my FD before maturity?

Yes, but most banks charge a 'premature withdrawal' penalty, usually between 0.5% and 1%, and the interest rate may be reduced to the rate applicable for the period the FD was actually held.

What is a Tax-Saving FD?

A tax-saving FD has a mandatory lock-in period of 5 years and allows you to claim a deduction under Section 80C of the Income Tax Act in India.

Do senior citizens get higher interest rates?

Generally, yes. Most banks offer senior citizens (aged 60+) an additional 0.50% interest rate on their fixed deposits.