Fixed deposits are popular investment tools that help investors earn safe and guaranteed returns across a specific timeline. However, FD earnings depend on the amount invested, the applicable FD interest rate, and the tenor chosen.
Say an individual books a ₹1 Crore FD; the interest per month they generate will be a sizeable sum. Again, this depends on the type of FD they choose. If they opt for a payout at maturity or a cumulative FD, then their interest earnings will be accrued over the specific tenor.
Alternatively, if investors choose a non-cumulative FD, they can opt for regular interest payouts across monthly, quarterly, half-yearly, or yearly frequencies.
Monthly Interest for a ₹1 Crore FD
See the table to understand the monthly interest payouts across various banks and NBFCs when investors book a ₹1 Crore FD.
Name of the Financial Institution | Tenor | Regular FD Interest Rates (p.a.) | Monthly Interest Payout | Senior Citizen FD Rates (p.a.) | Monthly Interest Payout |
Bajaj Finance Limited | 42 months | 8.28% | ₹69,000 | 8.51% | ₹70,917 |
PNB Housing Finance | 45 months | 7.58% | ₹63,167 | 7.88% | ₹65,667 |
Mahindra Finance | 42 months | 7.50% | ₹62,500 | 7.75% | ₹64,583 |
ICICI Bank | 24 months | 7.20% | ₹60,000 | 7.75% | ₹64,583 |
HDFC Bank | 24 months | 7.00% | ₹58,333 | 7.50% | ₹62,500 |
Disclaimer: The aforementioned interest rates are subject to change at the discretion of the financial institution. Kindly check the latest FD rates on the FD issuer’s website before booking an FD.
An Example Showing the Calculation of Monthly Interest Payouts for a ₹1 Crore FD
When booking a ₹1 Crore FD, the interest per month varies based on the issuer’s interest rate. To understand this better, consider a hypothetical example by comparing monthly interest payouts for a ₹1 Crore FD at various interest rates.
Interest Rate (p.a.) | Monthly Interest Payout |
6.00% | ₹50,000 |
6.50% | ₹54,167 |
7.00% | ₹58,333 |
7.50% | ₹62,500 |
8.00% | ₹66,667 |
8.50% | ₹70,833 |
9.00% | ₹75,000 |
9.50% | ₹79,167 |
10.00% | ₹83,333 |
Disclaimer: These values have been calculated for illustration purposes.
Key Factors to Consider When Booking an FD
Be it fixed deposits or any other investment avenues, it is crucial that investors factor in their goals and finances before making a decision.
Here are some key pointers that one needs to be aware of:
- Financial Goals
Remember, this is a unique factor that investors need to assess before investing in a fixed deposit. Say an individual has a sizeable sum of ₹1 Crore idle in their savings account. While investing in an FD can generate guaranteed returns, they can also consider other investment options. However, keep one’s risk factor in mind before zeroing in on a suitable investment vehicle.
- Duration of the Investment
The FD tenor is directly linked to one’s interest earnings. Simply put, the longer an individual stays invested, the higher their return on investment. Also, FD issuers offer higher rates if they choose a longer tenor.