Financial difficulties can come at any time. When you don’t have proper funds at your disposal, you are likely to struggle to meet the demands. This is why financial experts stress the habit of savings.
In the current market, you could invest in things like mutual funds, stocks, etc. But these investment instruments carry significant risks. What is their alternative?
Online Fixed Deposits offer notable returns and are great as a risk-averse investment option. Now, to help you make a decision, banks offer Fixed Deposit calculators. They will enable you to determine your interest income within a few seconds by considering the deposit amount, its tenure, and its interest rate.
A step-by-step guide to using the FD calculators
A Fixed Deposit (FD) calculator lets you put in information like the principal amount, type of Fixed Deposit, investment tenure and other details to get an estimate of the maturity amount and interest. See the FD returns by doing the following:
Step 1: Visit the page with the FD calculator
Visit the website of the bank whose FD best fits your investment goals and use the calculator there.
Step 2: Type in the details
After that, you need to put in the details (investment amount, the kind of Fixed Deposit you want to invest in, and its tenure). Then, click the ‘Calculate’ button to move forward.
Step 3: Check out the results
The Fixed Deposit interest rates calculator will then tell you how much interest and returns a certain FD plan will give you at the end of its term.
If you aren’t satisfied with the results, you can change the numbers you put in or use a different FD calculator. You will benefit from an FD calculator as it will show you the exact amount you will earn after completing your investment tenure. However, a Fixed Deposit calculator has more importance than this.
Why is the FD calculator important?
If you are investing in an online Fixed Deposit, here are the purposes of an FD calculator –
Make your analysis of investments easier
Many things can make it hard to figure out the return on a Fixed Deposit. With the help of an FD calculator, it’s easy to get accurate estimates.
Help you figure out the risks involved
If you use an FD calculator, you’ll know how much money you’ll get back, giving you a sense of safety. You can also use the FD calculator to figure out how much risk you can handle as an investor.
Ways to save time
FD interest calculator helps you plan your investments, and it saves you a lot of time. Also, complicated calculations can be made with the push of a button.
With the discussion about the FD calculator out of the way, let’s see how a Fixed Deposit works and why one should choose it over other investment options.
How does a Fixed Deposit work?
In the case of an FD, you, as a depositor, will submit a lump sum amount with a bank of your preference for a set period of time. During this pre-agreed period, you are not supposed to withdraw that money. However, in case you need it, banks will let you access the funds against a small penalty. However, in some cases, they do not impose this additional charge and let you break the deposit.
On the other hand, once you complete the tenure, banks will let you know and credit the amount to your registered bank account.
While planning to invest in FD, be aware of the associated aspects, like the interest rate, tenure options, added charges, etc.
Now the question is, why are FDs so popular? Let’s take a look –
- They are comparatively safe
- They guarantee return
- The return is generous
- FDs offer better flexibility
- They are a great tax-saving instrument
Parting thoughts
Fixed Deposits are a great way to build wealth without taking too much risk, and it is also a versatile investment instrument and offers incredible flexibility over other options. While planning to book an FD, make sure you get all your queries cleared or visit the nearest branch of your preferred bank
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