💡How Does FD Work?
A Fixed Deposit (FD) is a simple investment scheme. Here You deposit a fixed amount for a fixed time. The bank or post office pays you interest over it. You cannot withdraw before maturity (without penalty). The longer you keep your money with them, the more interest you will earn on your deposit. Interest is compounded, so your money grows faster.Interest Calculation for 5 Lakh FD
Let’s see how your 5 lakh will grow over time.
📌 First-Year Interest Post Office FD gives 7.5% per year. Interest for 5,00,000 in 1 year = ₹37,500. Total amount after 1 year = ₹5,37,500.
📌 5-Year Growth (If FD is Extended)
If you keep reinvesting for 5 years, the interest is compounded yearly.
| Year | Start Amount | Interest Earned | Total Amount |
|---|---|---|---|
| 1 | ₹5,00,000 | ₹37,500 | ₹5,37,500 |
| 2 | ₹5,37,500 | ₹40,312 | ₹5,77,812 |
| 3 | ₹5,77,812 | ₹43,335 | ₹6,21,147 |
| 4 | ₹6,21,147 | ₹46,586 | ₹6,67,733 |
| 5 | ₹6,67,733 | ₹50,080 | ₹7,17,813 |
Doubling Your Money (₹5 Lakh to ₹10 Lakh) To double your money, we use the Rule of 72.
Rule of 72 Formula: 👉 72 ÷ Interest Rate = Years to Double Money For 7.5% interest, 👉 72 ÷ 7.5 = 9.6 years
So, your 5 lakh will become 10 lakh in about 10 years.
📌 Growth of 5 Lakh Over Time
| Year | Estimated Amount |
|---|---|
| 5 | ₹7.17 Lakh |
| 10 | ₹10 Lakh |
🚀 How to Get Compounding in Post Office FD?
Unlike bank FDs, Post Office FD does not compound automatically. The interest is credited to your savings account, so you need to manually reinvest to get the power of compounding.📌 3 Ways to Compounding Your FD Returns
1. Reinvest in Another FD Every year, take the interest earned and invest it in a new FD. This way, your interest also earns interest. 2. Use Post Office Monthly Income Scheme (POMIS) + FD Invest in POMIS instead of FD. Interest from POMIS goes into Post Office Recurring Deposit (RD), which compounds. After 5 years, reinvest everything into another FD. 3. Manually Reinvest Every Year Suppose you earn 37,500 interest per year on 5 lakh. Instead of spending it, invest this amount into a fresh FD every year. Over time, this creates a compounding effect.By following this, you can still double your 5 lakh to 10 lakh, but you need to take action every year instead of letting it grow automatically.
Why Choose Post Office FD?
Safe Investment – Government-backed, no risk. Good Returns – Better than a savings account. Fixed Interest – No market risk, stable returns. Flexible Tenure – 1 to 5 years, extendable.🔄 How to Open a Post Office FD?
You can open a Post Office FD easily. 1️⃣ Visit the nearest Post Office. 2️⃣ Fill out the FD application form. 3️⃣ Submit Aadhaar, PAN, and photos. 4️⃣ Deposit money (cash/cheque/online). 5️⃣ Get your FD receipt. That’s it! Your investment starts earning interest from Day 1.🤔 Should You Invest in Post Office FD?
If you want guaranteed returns, Post Office FD is best.If you want higher returns, you can try Mutual Funds, Stocks, or Real Estate.
But for safe investment, Post Office FD is a great choice! You can Calculate your return Live with Calculator.
