FD Summary
| Principal Amount | ₹2,00,000 |
| Interest Rate | 7.25% p.a. |
| Tenure | 1 year |
| Compounding | Quarterly |
| Interest Earned | ₹14,899 |
| Maturity Amount | ₹2,14,899 |
Tax Note: The ₹14,899 interest earned is fully taxable at your income slab rate. In the 30% bracket, your after-tax interest is approximately ₹10,012.
Impact of Compounding Frequency
Same principal, same rate — different compounding gives different returns:
| Compounding | Principal | Interest Rate | Interest Earned | Maturity Amount |
|---|---|---|---|---|
| Monthly | ₹2,00,000 | 7.25% | ₹14,992 | ₹2,14,992 |
| Quarterly | ₹2,00,000 | 7.25% | ₹14,899 | ₹2,14,899 |
| Half-Yearly | ₹2,00,000 | 7.25% | ₹14,763 | ₹2,14,763 |
| Annually | ₹2,00,000 | 7.25% | ₹14,500 | ₹2,14,500 |
Returns at Different Interest Rates
How much does a 0.5% rate difference matter? More than you think:
| Interest Rate | Interest Earned | Maturity Amount |
|---|---|---|
| 6.5% | ₹13,320 | ₹2,13,320 |
| 7.0% | ₹14,372 | ₹2,14,372 |
| 7.25% | ₹14,899 | ₹2,14,899 |
| 7.5% | ₹15,427 | ₹2,15,427 |
| 8.0% | ₹16,486 | ₹2,16,486 |
Calculate Your FD Returns
Enter your exact deposit amount, interest rate, and tenure to get precise maturity value.
Use FD CalculatorFrequently Asked Questions
What is the maturity amount for ₹₹2 Lakh FD for 1 year?
At 7.25% interest with quarterly compounding, ₹₹2 Lakh FD matures to ₹2,14,899 in 1 year. You earn ₹14,899 as interest income.
Is FD interest taxable in India?
Yes. FD interest is added to your income and taxed at your slab rate. Banks deduct TDS at 10% if interest exceeds ₹40,000 per year (₹50,000 for senior citizens). You can submit Form 15G/15H to avoid TDS if your income is below taxable limit.
Which compounding frequency gives the best FD returns?
Monthly compounding gives the highest effective yield. For ₹₹2 Lakh at 7.25% for 1 year: monthly compounding gives ₹2,14,992, quarterly gives ₹2,14,899, and annual gives ₹2,14,500.
Should I break my FD if interest rates rise?
Breaking an FD early typically incurs a 0.5–1% penalty. Do the math: if new rates are 1%+ higher, breaking and reinvesting often makes sense for longer tenures. For FDs with less than 6 months remaining, it's usually not worth it.
FD vs SIP — which is better for this amount?
FD gives guaranteed returns of ₹2,14,899 in 1 year. SIP in equity mutual funds could potentially grow ₹₹2 Lakh lumpsum to ₹2,24,000 at 12% — but with market risk. FD suits short-term goals or emergency funds. SIP suits 5+ year wealth creation goals.