Indian Overseas Bank is one of the most trusted banking institutions in the country. It offers numerous services to the public, one of which is a lucrative fixed deposit investment scheme. This FD is a safe investment option, which offers guaranteed returns to investors, making them ideal for low-risk takers.

Furthermore, to help investors make a sound financial decision, the bank offers an IOB FD calculator to assess their interest earnings from the investment. An individual only needs to enter a few details regarding his/her FD to see an accurate outcome from the same.

In this article

**Benefits of Indian Overseas Bank FD Calculator**

While using the IOB FD interest rates calculator is optional, one can benefit greatly from such a tool. Listed below are just a few advantages that an investor can look forward to from such calculators.

- These calculators are easy to use, prioritising convenience over all other features.

- It hardly takes a few seconds to check profitability on such a tool. It would take much longer to calculate manually.

- Indian Overseas Bank FD calculator relays accurate results, provided the data entered by the user is correct. The same cannot be said for manual calculations, given that the interest calculation process can be long and cumbersome.

- Investors can freely alter certain parameters on the calculator until they reach the desired outcome. Thus, apart from profitability, this calculator can also help one decide their correct term and principal for FD investment.

However, before understanding the formula and method for FD calculation, prospective investors should take a look at the different terms and rates available for IOB FDs.

**Understanding Indian Overseas Bank FD Rates **

The table below can provide an idea regarding this aspect –

Investment tenure |
Normal FD rates |
FD rates for senior citizen |

7-45 days | 4.5% | 5.25% |

46-90 days | 4.6% | 5.35% |

91-120 days | 5.25% | 6% |

121-179 days | 5.5% | 6.25% |

180-269 days | 5.75% | 6.5% |

270 days-10 years | 6.1% | 6.6% |

444 days | 6.2% | 6.7% |

As the table indicates, senior citizen investors are eligible to receive increased interest from their FDs. In some cases, this is as high as 0.75% more than normal rates.

**How does the IOB Fixed Deposit Calculator Work?**

To determine the FD profitability using a calculator, or manually, one needs to follow a specific formula. This formula is,

**A = P (1+r/n) ^ n x t**

Here, A and P refer to the maturity amount and the principal investment, respectively. The investment tenure is represented by ‘t’, whereas ‘r’ signifies the FD interest rate applicable. Lastly, ‘n’ is the frequency at which interest is computed in a year.

To further clarify how this critical IOB FD calculator formula works, one can refer to the example illustrated below.

**Example of FD Calculation**

Ms. Sakshi is in her mid-forties and decides to invest Rs.6 lakh in an Indian Overseas Bank FD for 8 years. From the table above, one can see that she is eligible for 6.1% interest earnings on her investment. She picks annual interest computation for her investment.

From the information above, one can derive the following factors for Sakshi’s FD investment.

P = Rs.6,00,000

t = 8 years

r = 6.1/100 = 0.061

n = 1

Thus, A = 600000 (1+0.061/1) ^ 1 x 8

A = Rs.9,63,550

Return on investment for Sakshi would be I = A – P

Or, Rs. (9,63,550 – 6,00,000) = Rs.3,63,550

As is evident, manual calculations of such complexity can take a long time. This is why using an IOB fixed deposit calculator is the better option to determine FD profitability.

**How do Various Factors Affect FD Interest Earnings?**

Each parameter in the IOB fixed deposit interest rates calculator influences the final return on investment. An investor must understand how changes in each factor can improve or degrade their earnings from an FD.

**Investment sum or principal**

The amount individuals deposit into an FD account determines their interest-earning potential. One who invests more can take advantage of higher returns and vice versa. Thus, if an investor is unhappy with their projected returns from fixed deposits, he can increase the principal slightly and calculate profitability once again.

**Investment term**

How long an investor plans to deposit the sum also plays a huge role in determining his/her profitability from it. Most banks associate interest rates with investment tenure. Generally, banks reserve the most significant rates for people who invest for a considerable period, instead of just a few months.

**Rates of interest**

Picking the highest rates available is always beneficial for investors. However, to do so, one must be ready to park the funds for a significant period. This is because the highest rates are often reserved for longer terms. Further, senior citizen investors often receive extra interest on their FD investments.

Additionally, the frequency of interest computation can also affect total returns. Nevertheless, altering the frequency only slightly changes the returns. Thus, one can term such a change as inconsequential.

Using an FD calculator can help an investor pick the most suitable principal, interest rate and tenure. Also, it can help them set realistic expectations when it comes to returns on their investments.

**How to use IOB FD Calculator**

Based on the investment tenure of your choice and the corresponding interest rate applicable, you can find the amount of interest earned and subsequently the net amount you will receive at the end of the selected tenure. All you have to do is enter the principal amount, interest rate and time period in the respective fields in the calculator and the results would be generated instantaneously.