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FD VS EQUITY

FD vs Equity Returns Calculator

Compare fixed deposit returns vs equity CAGR with tax and inflation adjustments. See the real wealth gap between FD and equity investing over 5, 10, or 20 years.

FD vs Equity Returns Comparator

SBI 5yr FD: ~7.0%

Nifty 50 avg ~12%

FD interest is taxed at slab

Fixed Deposit

₹8,44,965

After 30.0% income tax on interest

Gross value₹9,92,807
Tax paid₹1,47,842
Effective CAGR5.4%
Real value (inflation adj.)₹4,71,824

Equity Investment

₹14,36,934

After 12.5% LTCG (₹1.25L exemption)

Gross value₹15,52,924
LTCG tax paid₹1,15,991
Effective CAGR11.1%
Real value (inflation adj.)₹8,02,376

Wealth Gap (Equity − FD)

+₹5,91,969

Real gap (after inflation): ₹3,30,552

Year-by-Year Growth

Year 1FD: ₹5,24,850Eq: ₹5,60,000
Year 2FD: ₹5,51,464Eq: ₹6,26,925
Year 3FD: ₹5,79,968Eq: ₹6,92,781
Year 4FD: ₹6,10,496Eq: ₹7,66,540
Year 5FD: ₹6,43,191Eq: ₹8,49,149
Year 6FD: ₹6,78,208Eq: ₹9,41,672
Year 7FD: ₹7,15,711Eq: ₹10,45,298
Year 8FD: ₹7,55,876Eq: ₹11,61,359
Year 9FD: ₹7,98,893Eq: ₹12,91,347
Year 10FD: ₹8,44,965Eq: ₹14,36,934

HOW IT WORKS

Simple steps to get your result

1

Enter Your Principal

Input the investment amount and time horizon in years.

2

Set FD & Equity Rates

Enter FD interest rate, expected equity CAGR, inflation rate, and your income tax slab.

3

See the Wealth Gap

Get after-tax values for both FD and equity, real inflation-adjusted values, and the year-by-year growth comparison.

FAQ

Frequently asked questions

Why is FD interest taxed at a higher rate than equity?+

FD interest is added to your total income and taxed at your marginal slab rate (up to 30%). Equity LTCG (if held >1 year) is taxed at flat 12.5% with ₹1.25 lakh annual exemption — making equity significantly more tax-efficient for long holding periods.

What is a realistic equity CAGR to use?+

Nifty 50 has delivered approximately 12–14% CAGR over 20+ year periods. Nifty Midcap has averaged ~15–18%. For conservative comparison, use 10–12%. Past returns do not guarantee future performance.

Should I always prefer equity over FD?+

Not always. FDs are ideal for emergency funds, short-term goals (<3 years), or capital you cannot afford to lose. Equity is appropriate for long-term goals where you can absorb short-term volatility.

Does this include dividend income from equities?+

No — dividends are excluded from this comparison for simplicity. Equity dividends are taxed at your slab rate. Index funds (Nifty 50 ETFs) typically reinvest dividends in the growth option, so NAV appreciation captures most of the return.

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