FDs are a type of investment that inculcate the habit of saving among the depositors. FD interest rate offered varies from one bank to another and also depends on the tenure selected. Financial institutions provide monthly interest on FDs. Moreover, certain financial tools can help investors choose the best scheme to provide the highest profit.
How to convert annual interest rate to monthly interest rate?
Follow the given steps to convert annual FD interest rate into monthly interest rate:
Divide the annual rate by 100 (to convert it from percentage to decimal format).
Divide the answer with 12 (number of months in a year).
Multiply this answer with the interest amount (to get the monthly rate).
Multiply this answer with 100 (to convert the monthly into percentage format).
Investors can simplify this task of calculating manually by using the online FD interest calculator. Online FD calculators can also be used to calculate FD maturity amount and monthly interest payout.
How to calculate the FD maturity amount with online FD calculator?
Investors can calculate the maturity amount with online FD calculators for free. Apart from the maturity value, investors can also check the amount of interest earned by following these steps:
Enter the following details in the respective columns: principal amount (size of the deposit) rate of interest (%), and tenor (months/ days/ years).
Choose the desired frequency (simple interest/ monthly/ quarterly/ half yearly/ annually).
Click on Calculate.
The maturity amount and the amount of interest earned will be displayed on the right-hand column.
How to calculate deposit on monthly interest payout?
Most banks which offer fixed deposit have an online portal which allows customers to calculate an estimate of the monthly interest payout. Individuals can calculate the monthly interest payout by following the same steps used to calculate the FD maturity amount. The only difference is that to calculate monthly interest payout investors must only choose the ‘monthly’ option in the frequency section. After filling in all the details, click on ‘calculate’. Here is a step-by-step procedure.
Enter the size of the deposit.
Choose the desired tenor.
Select the interest payout frequency option as ‘monthly’.
The online calculator will formulate an estimate of the monthly interest payout corresponding to the bank’s interest rate.
Benefits of using FD Calculator
Individuals can try various combinations on the online FD interest calculator to check the maturity amount that meets the investment goals.
Online FD calculators are useful to understand all the aspects before investing the funds in an FD.
Calculating all the combinations can be very tedious and time-consuming. It is tiresome to execute all the calculations considering all the parameters. An online fixed deposit interest calculator achieves this task in less than a second and free of charge.
It is not feasible to travel all the way to the bank to ask the bank employees about the FD maturity amount, interest rates, and monthly interest payout details; when one can do so conveniently at home.
Online FD calculators are easy to use and a convenient online financial tool.
The Bottom Line
Using the fixed deposit interest calculator is an efficient way to calculate the monthly interest on FD investment. Select the best FD scheme and tenor with the help of online fixed deposit calculators.