Fixed deposits remain the go-to for money you cannot afford to risk. Here is what ₹50,000 becomes in 3 years with quarterly compounding.
Maturity value by rate
| FD rate | Maturity value | Interest earned |
|---|---|---|
| 6% | ₹59,781 | ₹9,781 |
| 6.5% | ₹60,670 | ₹10,670 |
| 7% | ₹61,572 | ₹11,572 |
| 7.5% | ₹62,486 | ₹12,486 |
| 8% | ₹63,412 | ₹13,412 |
Keep it honest against inflation
At ~6% inflation, the real (purchasing-power) return of a 7% FD is roughly 1%. FDs are for capital safety and near-term goals. Interest is taxable at your slab, so the post-tax return is lower than the sticker rate.
Laddering tip
Instead of one ₹50,000 FD, split into three or four smaller FDs with staggered maturities. You keep liquidity without breaking the whole deposit (and paying penalty) in an emergency.
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