About the FD Auto-Renewal Calculator
What is the FD Auto-Renewal Calculator?
Many investors keep short FDs on auto-renewal: when one term ends, the principal and interest are reinvested at whatever rate the bank offers then. If rates are falling, locking in a longer FD today can be better; if rates are rising, short renewals win.
Enter the deposit, today's rate, the term of each FD, the number of terms and the expected rate change at each renewal. The calculator shows the value after all renewals, a term-by-term table and the difference versus one long FD at the starting rate.
How to use the FD Auto-Renewal Calculator
- Deposit Amount (₹) (sample: 5,00,000)
- Starting Interest Rate (% per year) (sample: 7)
- FD Term (years) (sample: 1)
- Number of Terms (first term + renewals) (sample: 5)
- Rate Change at Each Renewal (percentage points) (sample: -0.25)
- Press Project Renewals (results also refresh as you type). The result card shows the Value After All Renewals, along with Total interest earned, Rate in the final term, One long FD locked at the starting rate and Difference vs locking in.
Formula used
Value after term k = Value after term k − 1 × (1 + rₖ ÷ 4)^(4 × term)
- rₖ = starting rate + change × (k − 1), never below zero
Quarterly compounding is used, as at most Indian banks.
Worked example
These are the sample values already filled in the calculator above, and the result it returns for them:
| Input | Sample value |
|---|---|
| Deposit Amount (₹) | 5,00,000 |
| Starting Interest Rate (% per year) | 7 |
| FD Term (years) | 1 |
| Number of Terms (first term + renewals) | 5 |
| Rate Change at Each Renewal (percentage points) | -0.25 |
| Result | Value |
|---|---|
| Value After All Renewals | ₹6,90,205 |
| Total interest earned | ₹1,90,205 |
| Rate in the final term | 6% |
| One long FD locked at the starting rate | ₹7,07,389 |
| Difference vs locking in | ₹17,184 |
Tips for using the FD Auto-Renewal Calculator
- When the RBI is cutting rates, consider locking in longer tenures.
- Auto-renewal usually happens at the same tenure; check the renewal rate on the maturity advice.
- Laddering FDs of different tenures balances rate risk and liquidity.