About – Stock Market vs FD Returns Calculator

 

Our calculator helps you determine how much income you could generate by investing the same amount in a Fixed Deposit (FD) versus the Stock Market. You can customize the calculations based on your investment type — either lumpsum or monthly recurring investments.

Understanding FD and Stock Market Investments

1. What is a Fixed Deposit (FD)?

A Fixed Deposit is a secure savings option offered by banks and NBFCs where you deposit a lump sum for a fixed tenure to earn a higher interest rate than a regular savings account. Investment periods typically range from 7 days to 10 years. Note: Premature withdrawals might incur a penalty.

2. FD vs Savings Account

A Savings Account allows regular deposits and withdrawals, offering lower interest rates (around 3–4%). In contrast, FDs lock your money for a fixed term but offer better interest rates and may provide tax benefits under Section 80C.

3. What is a Recurring Deposit (RD)?

An RD allows you to deposit a fixed amount every month for a pre-determined period and earn interest similar to an FD. It's ideal for salaried individuals aiming to build disciplined savings.

4. Benefits of FD/RD
  • Low-risk and guaranteed returns.
  • Encourages regular savings.
  • Offers higher interest than savings accounts.
  • Eligible for tax deductions (under certain conditions).
  • Great for short to medium-term financial goals.
5. What is the Stock Market?

The stock market is a platform where investors buy and sell shares, bonds, and other securities. It represents ownership in companies and the possibility of participating in their profits.

6. How Does the Stock Market Generate Returns?

Investors earn money through:

  • Dividends — Periodic profit sharing by companies.
  • Capital Gains — Profit earned by selling stocks at a higher price.
On average, Indian stock markets have provided returns between 10% to 20% annually over the long term.

7. Benefits of Investing in the Stock Market
  • Potential for high returns and wealth creation.
  • Liquidity — easy to enter and exit investments.
  • Ownership in companies you believe in.
  • Helps beat inflation over time.
  • Diversification across sectors and industries.
8. Why Choose Stock Market Over FD?

While FDs offer safety, stock markets offer higher returns, better liquidity, and inflation-adjusted growth. There’s no lock-in period, and you can start with smaller amounts and grow gradually.

9. FD or Stocks – Which One to Choose?

The choice depends on your financial goals, time horizon, and risk appetite:

  • Choose FD/RD if you want guaranteed returns and safety.
  • Choose Stocks if you can handle short-term volatility for long-term wealth creation.

Conclusion

Every investment option has its pros and cons. Use our calculator above to simulate your returns and make an informed choice. Diversifying between FDs and equities can also help balance risk and return.