An investment of ₹1,00,000 for 5 years at an interest rate of 7.5% p.a. will grow to a maturity value of ₹1,43,563.
Calculation Breakdown
The total interest earned on your investment is ₹43,563.
Formula: A = P * (1 + r/n)^(n*t)
For annual compounding (n=1), this simplifies to A = P * (1 + r)^t.
Maturity Value = ₹1,00,000 * (1 + 7.5/100)^5 = ₹1,43,563
Example
If you invest ₹5,00,000 in an FD for 5 years at 7% interest, the final maturity amount would be approximately ₹7,01,276. The interest earned would be over ₹2 lakh.
What is a Fixed Deposit (FD)?
A Fixed Deposit (FD) is a secure investment instrument offered by banks and non-banking financial companies (NBFCs). It provides a higher interest rate than a regular savings account for a specified period, making it a popular choice for risk-averse investors seeking guaranteed returns.