FD maturity formula
M = P × (1 + r/n)^(n×t)
P = principal, r = annual rate, n = compounding periods/year (4 for banks), t = years
P = principal, r = annual rate, n = compounding periods/year (4 for banks), t = years
Example: ₹1,00,000 at 7% for 5 years, quarterly compounding → 1,00,000 × (1 + 0.0175)²⁰ ≈ ₹1,41,478. The effective annual yield works out to 7.19%, slightly higher than the nominal 7% because of quarterly compounding.
Remember the tax
FD interest is added to your income and taxed at slab rate. At 30% slab, a 7% FD effectively earns ~4.9% post-tax — below typical inflation. FDs are for capital safety, not wealth growth. Compare with the SIP calculator for long-term goals.