Dnncb

    Subscribe to Updates

    Get the latest creative news from FooBar about art, design and business.

    What's Hot

    About Bottled and Jarred Packaged Goods & its Pro’s and Con’s

    January 15, 2023

    Successful Accounting Software Implementation

    December 21, 2022

    Ximena Saenz Onlyfans Leaked Photos And Videos On Twitter reddit And Telegram

    December 5, 2022
    Dnncb
    • Home
    • News
    • TopTen
    • Business
    • Blog
    • Health
    • Food
    • Write for Us
    • Contact US
    Subscribe
    Dnncb
    Home » A Guide To Fixed Deposit And How It Is Calculated?
    Finance

    A Guide To Fixed Deposit And How It Is Calculated?

    Nurul AminBy Nurul AminSeptember 8, 2022No Comments3 Mins Read

    A fixed deposit is an investment that requires a lump sum amount deposit for a specific tenure. Your amount remains locked in for a fixed tenure so that you can avail the interest on the deposit. Below is a guide to fixed deposit and how it is calculated.

     

    Fixed Deposit Investment

    Are you looking to make a stable income? You can get this benefit by investing your money into a fixed deposit account. The investment return remains fixed, making you a steady source of income. Let us look at the pros and cons of depositing your funds in a fixed deposit account.

     

    Characteristics

    Pros

    Cons

    Principal Amount

    You must deposit a lump sum amount into a fixed deposit to avail the benefits of the same. Moreover, fixed deposits provide more significant returns as compared to savings accounts.

    Fixed deposits do not accommodate EMIs.

    Tenure

    Your money is locked in for a specific tenure. You benefit from achieving a substantial amount by the end of your fixed deposit term. Fixed deposits also allow you to hold multiple FDs of different tenures. The term for fixed deposit is flexible, ranging from seven days through ten years.

    A constant tenure keeps you from adding/withdrawing funds regularly.

    Market Risk & Interest Rate

    Fixed deposits can be risk-free investments. Your investments won’t be affected by market risks or fluctuations in the interest rate. Your principal amount is safe, and you get the scheduled returns. You also have the flexibility to select the mode of interest payment, i.e. monthly, quarterly or yearly. You get the benefit of attaining stable returns for your invested amount. In addition, senior citizens are offered a higher interest rate on fixed deposits.

    Fixed interest rate inhibits you from taking advantage of an upswing in the market or a sudden spike in the interest rate.

    Lock-in period

    Fixed deposit investments come with a specific lock-in period. This may keep you from withdrawing your funds unnecessarily and protecting your lump sum. However, you can withdraw your funds during emergencies by paying a small penalty fee. Additionally, you have the flexibility to share your fixed deposit investment with your spouse, parents and children.

    A penalty fee is charged in case of early withdrawal.

     

    If you are looking for the best fixed deposit scheme, Muthoot Capital offers monthly, quarterly and annual interest plans and maturity plans offering interest rates as high as 8.38%. You may visit our nearest branch or connect with us online and we will guide you through our offers.

     

    How is Fixed Deposit Calculated?

     

    The formula to calculate the simple interest on a fixed deposit is

     

    Simple interest = P*R*T/100

     

    If you wish to calculate the compound interest on your fixed deposit, you can use the below formula.

     

    Compound interest = P [ ( 1+ R/100 ) T – 1]

     

    Where P = invested amount, R = rate of interest, and T = Tenure of the fixed deposit.

     

    Alternatively, you can use our FD interest rates calculator to compute your returns.

     

    Conclusion

    A fixed deposit is a safe investment vehicle for investors looking for risk-free investments and stable returns.

     

    Previous ArticleMost Recent Updated Microsoft DP-100 Questions-Samples For Free (2022)
    Next Article PPC Management: A Brief Review
    Nurul Amin

    Related Posts

    Successful Accounting Software Implementation

    December 21, 2022

    Best Payroll Services for Your Small Business

    September 9, 2022

    5 Important Points You Need To Know When Investing In Debt Mutual Funds

    August 31, 2022

    Can You Buy a House With No Credit History?

    August 30, 2022
    Our Picks

    Health Benefits of Daily Walking to Maintain Fitness

    September 22, 2022

    The Health Benefits Of Modalert And Healthy Eating

    September 22, 2022

    How To Sleep While Taking Cymbalta

    September 21, 2022

    What Are Those Trends Children Should Avoid From Practicing

    September 21, 2022
    Don't Miss

    About Bottled and Jarred Packaged Goods & its Pro’s and Con’s

    By AdminJanuary 15, 2023

    When you go to a market, you will see many different ways food is packaged.…

    Successful Accounting Software Implementation

    December 21, 2022

    Ximena Saenz Onlyfans Leaked Photos And Videos On Twitter reddit And Telegram

    December 5, 2022

    Addison rae Onlyfans Leaked Photos And Videos On Twitter reddit And Telegram

    December 5, 2022

    Subscribe to Updates

    Get the latest creative news from SmartMag about art & design.

    © 2023 DNNCB.
    • Privacy Policy
    • Terms and Conditions
    • About US
    • Contact US

    Type above and press Enter to search. Press Esc to cancel.