Fixed deposits are a type of term deposits that enable a customer to earn a good amount of interest on his money in a given period of time. This facility is offered by banks and is one of the most reliable forms of investment where the returns are guaranteed. The interest rate offered in an FD is much higher than that of a savings account. The interest rates also vary from bank to bank and therefore it is important to analyze the market before making a decision. To do so, you can use an FD calculator which helps in calculating the maturity amount of your fixed deposit. An FD calculator is a tool that is available online to help an investor get an estimation of the maturity amount. There are a few simple steps that you need to follow for using this tool.
How To Use A FD Calculator?
An FD calculator can be accessed easily through online websites offering this service. Complex calculations can be done in a few clicks with the help of this calculator. It is a simple-to-use tool that is available free of cost on the internet. If you are planning to make a fixed deposit, you should use this calculator to know the returns on the investment at the end of a predefined tenure. To use an FD calculator, all you need to do is follow these few simple steps that are given below.
- Step 1: Search the website of an online FD calculator service provider and go to the page where you can access the calculator.
- Step 2: Most of the websites do not ask/take any personal information in order to render the service. However, some websites might ask you to register yourself on their website before using the calculator. In case it is required, register yourself by providing the details that are needed.
- Step 3: An FD calculator requires three inputs – deposit amount, rate of interest and tenure of the deposit. Fill up all the details accordingly.
- Step 4: Click on the calculate tab and the result will be displayed on the screen. The calculator gives you the amount that you would gain as interest and the total maturity value as well.
- Step 5: You need to click on the refresh/reset button in order to re-enter the details of any other plan that you are looking for. Once you click the refresh tab, the page will reset itself and you can enter new details in the same way. You will get different results for different inputs, which give an overview of the plans offered by banks.
This simple process can help you in calculating the returns that you can expect from your fixed deposit. In this way, you can use an FD calculator to compare different plans that are available in the money market. This allows you to choose the best plan and helps you to make the maximum gain out of your fixed deposit.
Advantages of FD Calculator
An FD calculator offers a lot of benefits to its user, such as:
- It is a time-saving tool
Mathematical calculations are time-taking and hectic as well especially for those who do not like them at all. This tool does the task for you in just a few clicks!
- It comes free of cost
Yes, the websites that provide the facility of FD calculators do not charge a single buck from the users. This means you can easily use this calculator for an unlimited number of times without any worry.
- It gives accurate results
Manual calculations are prone to errors and can give wrong answers if there is any mistake in the input values. Just like a physical calculator, this one also does an automatic calculation and therefore, eliminates the chances of errors.
- It is easily accessible
You can get the calculator on your smartphones and laptops etc. It can be found on the internet just by a single search.
- It helps you in choosing the right fixed deposit plan
You can compare all the available options and make an investment that you find most profitable. This would not be possible through manual calculations as the high probability of errors can affect your decision negatively.
Fixed deposits are profitable as the banks offer higher interests on them than savings accounts. However, it is also important to make a proper analysis of the money market and then choose the right plan. As said earlier, interest rates on FD offered to a depositor vary from bank to bank. This makes it important to make an accurate comparison and then make a decision. FD calculators help one to make this comparison through an easy and simple process. You can have an idea of the returns that the investment is going to yield after the maturity.
