Fixed Deposit (FD) vs SIP Calculator
Compare Fixed Deposit vs SIP returns with inflation adjustment. Calculate maturity, wealth difference & choose smarter investment in India.
FD vs SIP Calculator – Which Investment Is Better in India?
Choosing between Fixed Deposit (FD) and Systematic Investment Plan (SIP) is one of the most common investment dilemmas in India. Both options serve different purposes and suit different risk profiles.
What Is a Fixed Deposit (FD)?
A Fixed Deposit is a low-risk investment offered by banks and NBFCs where you earn a guaranteed interest rate for a fixed tenure.
What Is SIP?
SIP allows you to invest regularly in mutual funds. Returns are market-linked and can potentially be higher than FD over long term.
FD vs SIP – Key Differences
- FD offers guaranteed returns.
- SIP offers market-linked growth.
- FD has lower risk.
- SIP can beat inflation over long term.
Inflation Impact
Inflation reduces purchasing power. FDs may not always beat inflation after tax, while SIPs historically have provided higher inflation-adjusted returns.
Who Should Choose FD?
- Senior citizens
- Risk-averse investors
- Short-term goals
Who Should Choose SIP?
- Long-term investors
- Wealth creation goals
- Inflation-beating returns seekers
Taxation Difference
FD interest is fully taxable. SIP gains are taxed as capital gains, often lower than slab rate.
Conclusion
The right choice depends on your financial goals, risk tolerance, and time horizon.
Frequently Asked Questions
Is SIP better than FD?
SIP may offer higher long-term returns but carries market risk.
Is FD safer than SIP?
Yes, FD provides guaranteed returns.
Can SIP beat inflation?
Historically, equity mutual funds have outperformed inflation over long term.
Is FD interest taxable?
Yes, FD interest is taxable as per income tax slab.
Which is good for short term?
FD is generally better for short-term goals.