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FD / RD Calculator
FD & RD maturity at quarterly compounding — senior rate, cumulative vs payout, and post-tax TDS/slab. Accurate, instant and free — for India.
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₹1,00,000 at 7% compounded quarterly for 5 years matures to ₹1,41,478.
Growth over time
5 yrsHow FD maturity and RD returns are calculated
This calculator uses the quarterly compounding formula — the same convention used by banks in India. RD uses the instalment-summation method, where each monthly deposit earns quarterly-compounded interest for its remaining tenure. Results cross-checked against Groww, Paisabazaar, and ClearTax.
FD (cumulative)
A = P·(1 + r/n)^(n·t)
A = P × (1 + r/n)^(n×t)
- P = principal (lump sum)
- r = annual rate (decimal)
- n = 4 (quarterly, default)
- t = tenure in years
Interest = A − P. Senior: r = r + 0.5%.
FD (payout / non-cumulative)
Interest paid out periodically
Interest per period = P × r / payouts_per_year
- No compounding — interest is paid out, not reinvested
- Principal returned in full at maturity
- Monthly payout: divide r by 12
- Quarterly payout: divide r by 4
Effective yield = simple annual rate (no compounding benefit).
RD (instalment summation)
Monthly deposits, quarterly compounding
FV_m = R × (1+i)^((61−m)/3)
- R = monthly instalment
- i = r/4 (quarterly rate)
- m = month 1 … N
Maturity = Σ FV_m across all N instalments.
- 1FD quarterly vs annual @ 10%, 5y (the correctness lever): ₹1,00,000 × (1.025)^20 = ₹1,63,862 at quarterly compounding (bank reality). Annual compounding gives ₹1,00,000 × (1.10)^5 = ₹1,61,051 — the figure Groww uses as its headline example. The ₹2,811 gap is pure compounding-frequency effect; it grows with rate and tenure.
- 2FD realistic @ 7% quarterly 5y: ₹1,00,000 × (1.0175)^20 ≈ 1.4148 → ₹1,41,478. Interest earned: ₹41,478. Senior rate 7.5% → (1.01875)^20 ≈ 1.4498 → ₹1,44,985 — an extra ₹3,507 for the 0.5% senior premium over 5 years on ₹1 lakh.
- 3RD ₹5,000/mo × 60 @ 7% quarterly: Quarterly rate i = 7%/4 = 1.75%. Instalment m earns (1.0175)^((61−m)/3). Summing all 60: Maturity ₹3,59,664. Total deposited ₹3,00,000 (60 × ₹5,000). Interest earned: ₹59,664. The RD effective yield equals the FD rate — but with monthly cash-flow flexibility instead of a lump-sum lock-in.
Rate is bank-specific — enter your bank's current rate
Why quarterly compounding beats annual — and why it matters
Most online FD calculators default to annual compounding — but Indian banks credit interest quarterly. This is not a minor rounding difference; it is a correctness gap that grows with rate and tenure. This calculator defaults to quarterly to match bank reality.
Quarterly compounding (bank reality)
n = 4 — what your bank actually does
Formula
₹1,00,000 × (1.025)^20
@ 10% for 5y
₹1,63,862
Interest: ₹63,862
Annual compounding (many calculators)
n = 1 — understates your real return
Formula
₹1,00,000 × (1.10)^5
@ 10% for 5y
₹1,61,051
Interest: ₹61,051
| Rate | Tenure | Annual (n=1) | Quarterly (n=4) | Gap |
|---|---|---|---|---|
| 7% | 5 yr | ₹1,40,255 | ₹1,41,478 | ₹1,223 |
| 10% | 5 yr | ₹1,61,051 | ₹1,63,862 | ₹2,811 |
| 9% | 10 yr | ₹2,36,736 | ₹2,42,726 | ₹5,990 |
Principal ₹1,00,000. Gap grows at higher rates and longer tenures. Indian banks use quarterly (RBI/FEDAI standard).
Effective Annual Rate (EAR) vs nominal rate
FD laddering — staggered access without sacrificing yield
Putting all your savings into a single long-tenure FD locks you out of liquidity and exposes you to rate-reset risk at a single date. FD laddering splits the deposit across 1-, 2-, 3-, and 5-year tenures — giving staggered maturity dates, a blended yield close to the long-tenure rate, and no incumbent tool in India does this.
1-year rung
Immediate liquidity
Matures soonest — provides a liquid cash reserve and a near-term rate-reset opportunity.
At maturity, roll into a fresh 5-year rung (the longest, highest-rate tranche) so the ladder stays intact.
2-year rung
Medium buffer
Typically earns slightly above the 1-year rate. Maturity aligns with a 2-year cash-need horizon.
Roll into the 5-year rung when it matures.
3-year rung
Higher rate tier
Reaches the yield band where many banks offer their best rates (e.g. SBI/HDFC special tenures).
Roll into the 5-year rung at maturity.
5-year rung
Top yield + 80C
Highest yield tier; tax-saving FDs (§80C, up to ₹1.5 lakh) qualify only at 5-year lock-in.
This rung gets recycled deposits from each shorter rung as it matures.
- 1Deposit equal amounts across 4 tenures: Split ₹4,00,000 into four ₹1,00,000 FDs at 6.5% / 7% / 7.5% / 8% (sample rates; enter your bank's current rates). Each rung matures at year 1, 2, 3, and 5 — giving you access to cash at four distinct points with no single lock-in date.
- 2Blended yield vs single 5-year FD: Combined maturity ≈ ₹4,94,874 → blended effective yield ≈ 7.45% p.a. (weighted by tenure). A pure 5-year FD at 8% on ₹4L would give ₹5,93,804 — but with zero liquidity before year 5. The ladder sacrifices roughly 0.55% of yield in exchange for four liquidity windows.
- 3Roll each maturing rung into the 5-year position: When the 1-year rung matures, reinvest the proceeds into a fresh 5-year FD. After year 1, you now have three rungs: 1yr, 2yr, 4yr (the original 5yr). Repeat each year. Within 4–5 years, every rung becomes a 5-year FD maturing in sequence — maximising yield while maintaining annual liquidity.
Rates are illustrative
Post-April-2023 reality: FD and debt funds are taxed the same — so what decides?
Before April 2023, debt mutual funds enjoyed indexation-adjusted Long-Term Capital Gains (LTCG) tax — effectively making them more tax-efficient than FDs for investors in higher slabs. The Finance Act 2023 removed indexation for debt funds held less than 36 months, and subsequent amendments in Budget 2024 capped LTCG on debt funds at the investor's slab rate — the same as FD interest. The old tax-arbitrage advantage is gone.
| Tax slab | FD rate | FD post-tax | Debt fund to break even | Decision driver |
|---|---|---|---|---|
| 0% (nil slab) | 7.0% | 7.0% | 7.0% | Liquidity & safety |
| 5% | 7.0% | 6.65% | 6.65% | Pre-tax yield parity |
| 20% | 7.0% | 5.60% | 5.60% | Pre-tax yield parity |
| 30% | 7.0% | 4.90% | 4.90% | Pre-tax yield parity |
Post-April-2023 and post-Budget-2024: debt fund gains taxed at slab rate (same as FD interest). Break-even debt fund yield = FD rate × (1 − slab) ÷ (1 − slab) = FD rate. Decision is now pre-tax yield + liquidity + credit risk, not tax structure.
- 1Tax treatment is now identical (post-April-2023): Both FD interest and debt-fund gains are taxed at your slab rate. There is no longer a tax-efficiency argument for debt funds over FDs (or vice versa) — the old indexation benefit that let long-term debt fund investors pay 20% with indexation is gone. At a 30% slab, both instruments leave you with 70% of the pre-tax return.
- 2Prefer FD when: capital safety and guaranteed return matter most: FDs are insured up to ₹5 lakh per depositor per bank (DICGC). The return is locked in at booking — no NAV volatility. For short-term goals, emergency funds, or conservative savers, the certainty is the point.
- 3Prefer debt funds when: liquidity, daily NAV, or shorter-duration matters: Liquid and ultra-short-duration debt funds can be redeemed within 1–2 business dayswith no pre-payment penalty (vs FD premature withdrawal penalises 0.5–1% off the rate). If a debt fund's pre-tax yield exceeds the FD rate (possible in high-yield credit funds, with higher credit risk), the post-tax outcome is also better.
Tax law changes — verify current rules
Frequently asked questions
Fixed deposit interest is calculated using the compound interest formula A = P × (1 + r/n)^(n×t), where P is the principal, r is the annual interest rate (as a decimal), n is the number of compounding periods per year, and t is the tenure in years. Banks in India compound FD interest quarterly (n = 4) by default — so for a Rs 1,00,000 FD at 7% for 5 years, the quarterly multiplier is (1.0175)^20 ≈ 1.4148, giving a maturity of Rs 1,41,478 and interest earned of Rs 41,478. In payout mode (non-cumulative), interest is not reinvested; the bank pays it out monthly or quarterly and returns the principal at maturity.
At the same nominal rate, more frequent compounding means interest is credited sooner, and that credited interest itself earns interest sooner. At ₹1,00,000 @ 10% for 5 years: annual compounding → ₹1,61,051. Quarterly compounding → ₹1,63,862. The gap is ₹2,811 on a single ₹1 lakh deposit. Banks actually use quarterly, so using annual understates your real return. See the Compound Interest Calculator for full frequency comparison.
Yes. Most banks and NBFCs offer senior citizens (age 60 and above) a preferential rate of +0.5% per annum over the general FD rate (some banks offer up to +0.75% on select tenures). For example, if the general rate is 7%, a senior citizen earns 7.5%, giving a maturity of approximately Rs 1,44,985 on Rs 1,00,000 for 5 years at quarterly compounding — roughly Rs 3,500 more than the general rate. The TDS threshold for senior citizens is also higher: Rs 1,00,000 per year (vs Rs 50,000 for general depositors, as raised in Budget 2025). The senior rate is bank-specific; enter your bank's actual senior rate for exact results.
TDS on FD interest is a withholding mechanism, not the final tax. As of FY2025-26: banks deduct TDS at 10% (with PAN) when annual FD interest exceeds ₹50,000 (general) / ₹1,00,000 (senior). Without PAN: 20%. Submit Form 15G/15H if income is below the taxable limit. TDS is a prepayment — actual liability is at your slab. See the Take-Home Salary Calculator to estimate your slab.
In a Recurring Deposit, each monthly instalment is compounded quarterly for its remaining tenure. For ₹5,000/month × 60 months @ 7% (quarterly rate i = 1.75%): summing all 60 instalments gives a maturity of ₹3,59,664 against total deposits of ₹3,00,000 — interest earned ₹59,664. Compare to a SIP Calculator for market-linked monthly investing, or a PPF Calculator for a tax-free sovereign option.
Method, assumptions & references
Methodology: FD maturity computed as P×(1+r/n)^(n×t); default n=4 (quarterly), matching bank practice. RD uses instalment-summation: each monthly deposit earns quarterly-compounded interest for its remaining tenure. Senior rate = general rate + 0.5% (typical; enter your bank's actual senior rate). TDS thresholds: ₹50,000 general / ₹1,00,000 senior (FY2025-26, Budget 2025); TDS is a withholding, not the final tax — slab liability applies. Golden examples engine-exact and cross-validated: ₹1,00,000 @ 10% quarterly 5y = ₹1,63,862; @ 7% quarterly 5y = ₹1,41,478; RD ₹5,000 ×60 @ 7% = ₹3,59,664. Rates are bank-specific and change; verify your bank's current rate before booking. Not financial advice.
Cross-links
How we calculate this
Reviewed by Reckonist Editorial · Last reviewed 16 June 2026. Figures follow the methods and sources set out in our editorial standards.
Rates are bank-specific and change frequently with RBI repo-rate movements; TDS thresholds reflect FY2025-26 Budget 2025 rules. TDS is a withholding mechanism — actual tax liability is at your income-tax slab rate. Verify your bank's current rate and senior-citizen premium before booking. FD returns shown are pre-tax unless post-tax mode is selected. Not financial advice — consult a SEBI-registered investment adviser or CA for personal planning.
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