Post Office FD Calculator (Time Deposit)

How the post office FD calculator works

Post office time deposit interest is calculated every quarter but credited once a year. So for each year, the yearly interest = deposit × ((1 + rate ÷ 400)^4 − 1). The deposit itself does not grow, because the interest is paid out to your savings account or taken by you each year.

For ₹1,00,000 in a 5 year TD at 7.5%: 1.01875^4 = 1.07714, so the yearly interest is ₹7,714 and over 5 years you receive ₹38,568, plus your ₹1 lakh back at the end. If you reinvest each year's interest, the total grows closer to the ₹1,44,995 that full quarterly compounding would give. Many online tables show that higher figure; the calculator shows both so you know which one applies to you.

Post office FD interest for each tenure

These use the rates in the box above; the calculator picks up any change made in a new quarter. Your account keeps the rate that applied on the day you opened it for the whole tenure.

Post office FD calculator monthly interest: is there a monthly option

The time deposit pays interest yearly, not monthly. If you need a monthly income, the post office Monthly Income Scheme pays every month, currently at 7.4% a year. On ₹5 lakh that is about ₹3,083 a month. Use the post office MIS calculator for it. Senior citizens can get quarterly income at a higher rate through the SCSS calculator.

You can also set up a standing instruction to move the TD's yearly interest into a post office RD, which keeps the money growing.

Rules for the post office time deposit

• Open with ₹1,000 or more, in multiples of ₹100. Single or joint (up to three adults), or by a guardian for a minor.
• Premature closure is not allowed in the first 6 months. Between 6 and 12 months you get the savings account rate. After 1 year, interest is paid at the rate for the completed period minus 2% on the 2, 3 and 5 year deposits.
• You can extend the TD at maturity for the same tenure.
• Only the 5 year TD qualifies for the small savings deduction under the old tax regime.

Rules are on the India Post website; confirm at your branch before you deposit.

Post office FD vs bank FD

A post office TD has a government backed rate that is the same at every branch. A bank FD rate differs by bank, tenure and age group, and interest compounds within the deposit. Bank deposits carry DICGC insurance, capped at ₹5 lakh for each person at each bank. On a 5 year horizon the post office's 7.5% often compares well, but check a few banks with the FD calculator.

Tax treatment is the same: interest is taxable at your slab rate. TDS rules apply to post office TDs too, so share your PAN with the post office.

Using a TD for a planned expense

Pick the tenure that ends just before you need the money. For ₹5 lakh needed in 5 years, a 5 year TD pays ₹38,568 a year in interest. If you need the whole amount at the end, reinvest that interest in an RD or a new TD so it does not sit idle in a savings account. The post office calculator puts TD, RD, MIS, NSC, KVP and PPF side by side.