Fixed deposits remain the go-to for money you cannot afford to risk. Here is what ₹25,000 becomes in 5 years with quarterly compounding.
Maturity value by rate
| FD rate | Maturity value | Interest earned |
|---|---|---|
| 6% | ₹33,671 | ₹8,671 |
| 6.5% | ₹34,510 | ₹9,510 |
| 7% | ₹35,369 | ₹10,369 |
| 7.5% | ₹36,249 | ₹11,249 |
| 8% | ₹37,149 | ₹12,149 |
Keep it honest against inflation
At ~6% inflation, the real (purchasing-power) return of a 7% FD is roughly 1%. FDs are for capital safety and near-term goals — for a 5-year horizon, compare with index SIPs for part of the amount. Interest is taxable at your slab, so the post-tax return is lower than the sticker rate.
Laddering tip
Instead of one ₹25,000 FD, split into three or four smaller FDs with staggered maturities. You keep liquidity without breaking the whole deposit (and paying penalty) in an emergency.
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