Precisely compute the future value of your savings, Fixed Deposits (FD), and Recurring Deposits (RD) using the power of compound interest. Input your details below for instant, real-time results to aid your 2026 financial planning.
Enter your deposit or loan details. The calculator updates results in real-time[citation:1][citation:10].
Most bank FDs compound quarterly, while savings accounts may compound daily[citation:6].
Note: This calculation assumes a constant interest rate and no additional deposits or withdrawals. Results are estimates for informational purposes.
This calculator uses the standard compound interest formula used by banks globally to compute the future value (A) of an investment or loan:
It's crucial to distinguish between the two main types of interest[citation:6]:
| Type | How it Works | Best For | Example (P=$1,000, r=5%, t=3y) |
|---|---|---|---|
| Simple Interest | Interest is calculated only on the original principal amount each year. | Short-term loans, some bonds. | Yearly interest: $50. Total: $1,150 |
| Compound Interest (Used here) | Interest is calculated on the principal plus all previously accumulated interest ("interest on interest"). | Savings accounts, FDs, RDs, long-term investments. | Year 1: $1,050. Year 2: $1,102.50. Total: ~$1,157.63 |
The "compounding effect" makes a significant difference over longer periods, which is why starting to save early is so powerful.
Here’s how different individuals can use this calculator for 2026 financial planning:
Scenario: Rahul wants to invest $25,000 in a 3-year FD offering 7.2% p.a. compounded quarterly.
Calculation: Using the formula with P=25000, r=0.072, n=4, t=3.
Result: His maturity amount will be approximately $30,958, earning $5,958 in interest. This helps him compare bank offers.
Scenario: Priya saves $500 per month in an RD at 6.5% p.a. for 5 years. (Note: This requires a specialized RD formula for monthly deposits, which our RD Calculator handles).
Takeaway: While this calculator shows the power of compound interest on a lump sum, for regular monthly savings, the final corpus can be substantial due to discipline and compounding combined.
Scenario: A bank offers a "high-yield" savings account at 4.8% with daily compounding. You have $10,000 to park as an emergency fund.
Calculation: P=10000, r=0.048, n=365, t=5.
Result: In 5 years, without touching it, the fund grows to about $12,712. The daily compounding yields slightly more than if it were compounded monthly.
Pro Tip for 2026: Always compare the Annual Equivalent Rate (AER) or Effective Annual Rate (EAR) when shopping for financial products, not just the nominal rate. This calculator's "Effective Annual Yield" output does exactly that, accounting for compounding frequency[citation:6].
Quick answers to common questions about bank interest calculations.
It varies by product and bank:
Daily compounding yields the highest return, as interest starts earning its own interest immediately[citation:6]. Always check your bank's terms.
AER (Annual Equivalent Rate) is the effective annual rate, taking compounding into account. The advertised nominal rate is the base rate before compounding. For example, a 6% nominal rate compounded monthly results in an AER of about 6.17%. The AER gives you a true "apples-to-apples" comparison between products with different compounding schedules[citation:6].
No. This tool provides a mathematical projection based on the inputs you provide. Actual returns depend on:
It depends on your cash flow needs and reinvestment strategy:
Use this calculator with a "Yearly" compounding frequency to simulate a cumulative FD for the best growth.
This calculator shows the total cost of a loan if no payments are made (like a simple interest balloon loan). However, for standard installment loans (home, car, personal), you need an EMI (Equated Monthly Installment) calculator, which factors in regular repayments.
For accurate loan planning, use our specialized EMI Calculator or Personal Loan Calculator.
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