This savings interest calculator shows how much interest your savings account earns on the balance you keep. Type your average balance, your bank's savings rate and the number of months. It follows the bank method, daily balance and quarterly credit, assuming your balance stays steady.
Savings rates are low compared with deposits, so the page also shows how much more the same money could earn elsewhere while staying easy to reach.
At a glance
- How banks calculateOn each day's closing balance
- When it is creditedEvery quarter at most banks
- Example₹1 lakh at 3% for 12 months: about ₹3,034
- Post office savings rate4.0% a year
- TaxTaxable, with a deduction under the old regime
- RatesSet by each bank, often by balance slab
How the savings interest calculator works
Each day's closing balance is multiplied by the annual rate over 365; the daily bits are summed and posted once a quarter. Because the quarterly credit is added to your balance, it earns interest in the next quarter, so there is a little compounding.
With an average balance of ₹1,00,000 at 3% for 12 months, the calculator gives about ₹3,034, which is roughly ₹253 a month. At 4%, the figure is about ₹4,060. If your balance swings during the month, use your average balance; your bank statement shows the actual credits.
Savings account interest calculator monthly: quick table
| Average balance | Rate | Interest in a year | About per month |
|---|---|---|---|
| ₹1,00,000 | 3% | ₹3,034 | ₹253 |
| ₹1,00,000 | 4% | ₹4,060 | ₹338 |
| ₹5,00,000 | 3.5% | ₹17,731 | ₹1,478 |
Many banks pay a lower rate on the first slab of balance and a higher one above a threshold. If yours does, work out each slab separately and add them.
Post office savings account interest
The post office savings account pays 4.0% a year. Its interest uses the smallest balance from the 10th to month end and is credited yearly, so money added after the 10th waits a month to start earning. It is a useful link account for receiving interest from post office schemes; see the post office calculator for those.
Tax on savings bank interest
Savings interest is added to your income. Under the old tax regime there has been a deduction for savings account interest of up to ₹10,000 a year, and a larger combined limit of ₹50,000 for senior citizens covering deposit interest too. The new regime generally does not offer these deductions. Banks do not usually deduct TDS on savings interest, so remember to show it in your return. Limits can change, so confirm them each year.
Earning more on idle balances
- Auto sweep: many banks move balance above a limit into an FD automatically and break it when you need the money. Interest is at FD rates.
- Short FDs: see what a 3 to 12 month deposit pays on the FD calculator.
- Recurring deposit: for money you add monthly; see the RD calculator.
- Keep enough in savings for a few months of expenses and bills, so you never pay overdraft or bounce charges.
For any other interest question, the interest calculator handles simple and compound cases.
Checking your bank's figure
Download a statement for a full quarter and note the interest credit. Work out your average daily balance for that quarter: a rough way is to add the balance on each day and divide by the number of days. Put that average, your bank's rate and 3 months into the calculator. The two figures should be close. A large gap may mean a slab rate, a rate change during the quarter, or a charge deducted on the same day.
Frequently asked questions
How is savings account interest calculated?
On each day's closing balance, at the yearly rate divided by 365, and credited every quarter at most banks.
What does ₹1 lakh earn in a savings account in a year?
About ₹3,034 a year at 3%, or about ₹4,060 at 4%.
Is savings account interest credited monthly?
Most banks credit it quarterly, though they calculate it daily. A few banks credit monthly.
What rate does the India Post savings account pay?
4.0% yearly, on the month's minimum balance after the 10th.
Is savings interest taxable?
Yes. The old regime has offered a deduction up to ₹10,000 a year (₹50,000 for seniors). TDS is not usually deducted.
Does this saving bank interest calculator suit every bank?
Yes. Type your bank's rate. If it uses balance slabs, calculate each slab separately.