Interest earned on a fixed deposit is governed by compound interest. This computation is not easy to master and manually doing the math is likely to leave you mentally exhausted. Moreover, you cannot rule out human errors and miscalculations. An easy way to sidestep this and get accurate results about your investment in moments is using the Bajaj Finance FD calculator.
Whether you want to plan your finances, obtain figures relating to ROI, or get data to determine the applicable tax on fixed deposit investments, this is a one-stop-solution to simplifying your FD computations.
Here are the 5 easy steps to use the Bajaj Finance FD calculator.
- Access the calculator: To begin, log on to the FD calculator online. You can do it here.
- Select the special tenor scheme: If you are investing for the special tenor scheme, choose ‘Yes’. If not, choose ‘No’.
- Select customer type: From the drop-down menu, choose whether you are a new customer, existing customer, or senior citizen.
- Choose the payout option: In case you want regular interest payouts, choose the Non-Cumulative option or pick Cumulative if you want the interest at maturity.
- Enter principal and tenor: Finally, enter the principal amount you want to start with, and the maturity term in the respective fields.
Once you have entered these details, the calculator will generate results swiftly. It will tell you your maturity amount, and the amount of interest you will earn. Take a look at these examples to understand how the calculator works.
A practical example to understand the FD Calculator
Consider that you are a new customer looking to invest a sum of Rs.20 lakh for a 2-year tenor and want to access your interest earnings at maturity. Once you feed these details into the FD calculator, it auto-fixes the FD interest rate and generates results. In this case, you obtain an interest rate of 8.15%, which means you will be earning an interest of Rs.33,928. Therefore, your maturity amount equals Rs.2,33,928.
In case you want to find out the returns for a senior citizen with the same principal and tenor, simply select the appropriate option from the dropdown menu. Now, the FD rate you obtain is 8.50% and the resulting interest and maturity amount goes up to Rs.35,445 and Rs.2,35,445 respectively.
Selecting the right option is all you need to do, and this makes FD calculators a simple and trustworthy tool for financial planning. Here are some of the inferences that you can draw from the results generated.
Settle on the right principal amount
Once you learn the amount you will take back at maturity, you can decide whether you need a more sizeable principal to start with or not. The interest works in proportion to the principal amount you invest, so boosting it will increase your overall returns as well. At times, issuers will offer FD rates that vary with the slab in which your principal amount falls in.
Select the appropriate investment tenor
Tweaking the investment tenor helps you maximize your profits in two ways. Firstly, the longer the tenor, the higher is the returns you obtain. This is because your fixed deposit earns interest via compound interest calculations. This means the longer the duration, the higher will be your earnings, as with each compounding the earlier earned interest will get added to the principal and then the next round of compounding takes place on the bigger sum.
Secondly, issuers will often give higher FD interest rates for maturity terms that are 36 months or more in length. By putting together these two factors, the FD calculator will help you choose a tenor that will augment your returns.
See how much tax your interest attracts
Interest earned on your fixed deposit is taxable. Your total taxable income is inclusive of your FD interest income. So, determine this and find out the tax slab you fall under. Them, based on the percentage of deduction, you can deduce your tax liability. However, you must note that financial institutions deduct a TDS on your earnings every financial year in advance. NBFCs, in this case, deduct TDS if your interest earnings for the year exceeds Rs.5,000. Banks and post offices, on the other hand, as per the Interim Budget 2019’s proposals will now cut TDS on your interest income exceeding Rs.40,000. This was earlier capped at Rs.10,000. This is capped at Rs.50,000 for senior citizens.
Now that you know the importance of an FD calculator, use it to generate the best from your Bajaj Finance Fixed Deposit. By choosing the right tenor, you can get FD interest rates of up to 8.75% as a new customer with this issue, and up to 9.10% if you are a senior citizen on a 36-month FD. This FD also flaunts the ICRA’s MAAA and CRISIL’s FAA safety rating, thus ensuring that your investment is secure.
Starting this investment is convenient and easy as you not only get to compute your exact earnings thanks to the FD calculator, but can also enjoy online account management, and a simple online application as well. So, don’t delay your investment plan and start right away. You only need Rs.25,000 to do so!