FD formula
Maturity A = P × (1 + r/k)k×t. Here P is the deposit, r is the annual rate, k is how many times a year interest compounds, and t is the time in years. Most Indian banks compound FD interest quarterly.
FD interest is taxable according to your income slab, and banks may deduct TDS. Senior citizens usually get a higher rate.
Frequently asked questions
Why is the effective yield higher than the rate?
Compounding earns interest on interest, so the actual yearly growth is a little higher than the quoted rate.
Does this include TDS?
No. The result is the pre-tax maturity amount.
Can I use it for RD?
No. Recurring deposits need a different formula, because you deposit money every month.