Fixed Deposits offer higher interest rates than a savings account, making them an ideal addition to your portfolio. To ensure that you get the best FD interest rates, remember that they vary from one financial institution to another, and so, you must compare offerings before selecting one. Also, NBFCs offer a higher interest rate on fixed deposits, around 8.4%, as compared to other financial institutions that hover around the 7% mark.

 

Using an FD calculator allows you to calculate your maturity amount on your FD and pick the best FD with the highest interest rate. Here’s how you can use the calculator to do so.

 

• Select the right fixed deposits

Several NBFCs offer fixed deposits, so it is important that you do your research. Evaluate your options thoroughly and list your top options. Consider at least 5 financial institutions and note down their interest rates for an FD investment. Don’t forget to check the CRISIL ratings for these FDs. A high rating of FAA or FAAA ensures that your investment is safe and that you will get your earnings in a timely fashion. After shortlisting the best FDs this way, you can proceed to the next step.

 

• Feed the appropriate numbers into the FD calculator

After you have made a list of the financial institutions that seem appropriate, use the FD calculator to find out the maturity amount for each FD. Visit an online FD calculator and feed in data regarding the initial FD investment that you decide to make, the tenor of this deposit, and the FD interest rate according to the respective financial institution. Then click on calculate. You will be able to see your maturity amount. Repeat this step for each of the fixed deposits that you have shortlisted.

 

• View results and decide accordingly

Once you decipher the maturity amount for all fixed deposits, zero in on the one that offers you the highest returns. Then, check to see if it whether or not it offers flexibility. Check the premature withdrawal penalty and timeline and also check if the FDs you signing up for offer a loan against FD in your time of need. Proceed after you check all these important details.

 

For instance, you can choose a Bajaj Finance Fixed Deposit and earn a competitive interest rate of up to 8.40%. Here, you can maximise your returns with an additional 0.35% interest rate for senior citizens, and start a deposit with as little as Rs.25, 000. With a flexible tenor as well, this is one of the safest investment options for retirement as it offers guaranteed returns.

 

Take a look at a few reasons why you should rely on an FD calculator to make important investment decisions.

 

• It is accurate and easy to use

One of the advantages of using an FD calculator is that it is completely accurate. It offers you results in seconds, and isn’t prone to errors, which is a risk you take on when performing these calculations manually. Besides, you only have to enter a few details, or adjust slider bars to determine the results. Therefore, it gives you all the information on your fingertips.

 

• It gives you an insight on the impact of the interest rate and choice of tenor

An FD calculator allows you to change parameters with ease, thereby allowing you to ascertain their impact on your investment. A 1% difference in interest rates may not seem like much, but using a calculator will show just how much of a difference it can make to your wealth in the long run. In addition, it shows you how staying invested for a short tenor, as opposed to a long one, affects your returns.

 

Simply follow these steps to arrive at the fixed deposit that is best for your investment goals and work your way to a financially successful future.