Fixed deposits (FDs) are a safe and convenient way to save money and make it grow. FDs are for a specific tenure; the interest rate on the deposit depends on the investment terms and duration. Even though you know the interest rate, you might not be sure about the exact amount you will receive on maturity (in cumulative deposits) or at regular intervals (in traditional deposits). This is where a fixed deposit calculator can be of great help.
What is an FD Calculator?
The FD calculator helps you compute the maturity value of your deposit at a specific rate of interest and a fixed term. The calculator also provides the payout value you will receive monthly, quarterly or annually in case of a traditional FD investment.
How to use an FD Calculator?
Using an online fixed deposit calculator is simple. You need to key in data in the provided boxes or space. You enter the deposit amount, interest rate, duration, and interest payout (maturity or periodically) details.
Once you fill in the details, you get the maturity value of your deposit or the amount you will receive periodically (in a traditional FD, the maturity value is the same as the deposit value as you get the interest at your chosen intervals).
Features of Axis Bank Fixed Deposits
● Axis Bank offers fixed deposits at attractive terms and rates.
● Axis FD Rates range from 2.50% to 5.75% per annum.
● The rates vary with the deposit amount. Deposits below Rs 5 crores are categorised into four groups.
● The table below gives the Axis Fd Rates range for different amounts.
Amount Interest Rate
Below Rs 2 crores 2.50% to 5.75%
Rs 2 crore to less than 4.91 crores 3.05% to 4.75%
Rs 4.91 crores to less than Rs 4.92 crores 2.50% to 3.00%
Rs 4.92 crores to less than Rs 5 crores 3.05% to 4.75%
● Senior citizens get higher interest rates.
● The FD tenure ranges from 7 days to 10 years.
● You can start a fixed deposit by investing a minimum of Rs. 5,000.
● Axis Bank offers the option of online account opening services.
● Easy transfers from savings accounts to fixed deposit accounts.
● An automatic roll-out facility is available.
● You can get the FD interest credited to a designated account.
How can an FD calculator help you in financial planning?
Financial planning is all about aligning your savings and investments with your future goals and requirements. A fixed deposit calculator can help you plan your finances in the following ways:
Compare
With an FD calculator, you can compare the rates offered by various banks and how they impact the maturity amount. Comparing the interest earned based on the difference in FD terms is also easy with a fixed deposit calculator. You can make an informed decision about the bank and FD term to align it with your financial goals.
Target-based investing
In this approach, you adjust your investment amount based on your target. For example, you know you will need Rs. 15,00,000 for your child’s education after ten years. So, you can use a fixed deposit calculator to compute the amount you should save to achieve your goal.
What’s more, you can compare the offers from various banks to choose one that helps you reach your objective with ease.
Investment Amount Approach
In the method, you know the amount you want to invest. The fixed deposit calculator helps you estimate returns on the investment and compare between different options.
A few examples can help you understand how to use an FD calculator in financial planning.
Example I
● You invest Rs 100,000 for five years.
● Axis FD Rates are 5.75% for that duration.
● The maturity value of your investment will be Rs 133,036.
● However, you need Rs 150,000 at the end of 5 years to buy a new car.
● You can increase the investment amount to match your requirements.
● Rs. 1,15,000 invested @ 5.75% will give you Rs 152,992.
Example II
● You invest Rs 500,000 for 5 years.
● At 5.75%, your monthly payment is Rs 2,384.
● Increasing the tenure, in this case to 8 years, will not impact the monthly payouts as the interest rate is the same for that tenure too.
Example III
● You deposit Rs 500,000 for 1 year.
● The maturity amount is Rs 525,992.
● However, if you increase the tenure by a few days to one year and 11 days, your maturity amount goes up to Rs 527,873.
● The Axis FD Rate for one year 11 days is 5.30% compared to 5.10% for a year.
To sum it up
FDs are an integral part of most investment portfolios. A fixed deposit calculator can help you plan your deposits better. You can choose the most suitable tenure and deposit amount based on your bespoke requirement and compare returns offered by different banks. With this tool you can make more informed and data-driven choices.