FD vs SIP Calculator: Fixed Deposit vs Mutual Fund Comparison
Compare FD vs SIP investment returns. See which option delivers better post-tax returns for your investment horizon and goals.
| Feature | FD (Fixed Deposit) | SIP (Systematic Investment Plan) |
|---|---|---|
| Returns Type | Guaranteed fixed returns✓ BEST | Market-linked, variable returns |
| Typical Returns (5yr) | 6-7.5% p.a. | 10-15% p.a. (equity)✓ BEST |
| Risk Level | Very low (virtually risk-free)✓ BEST | Moderate to high (equity) |
| Tax on Returns | As per income slab (added to income) | LTCG 10% above ₹1L, STCG 15%✓ BEST |
| Post-Tax Returns (30% slab) | 4.2-5.25% effective | 8-13% effective (equity)✓ BEST |
| Lock-in Period | 7 days to 10 years (flexible) | No lock-in (open-ended funds) |
| Capital Protection | 100% principal guaranteed✓ BEST | No guarantee, subject to market risk |
| Best Investment Horizon | 1-3 years (short term) | 7+ years (long term) |
| Inflation Protection | Limited - may not beat inflation post-tax | Good - historically beats inflation✓ BEST |
| Insurance Cover | Up to ₹5 lakh (DICGC)✓ BEST | No insurance coverage |
Summary
FD is best for short-term goals (1-3 years), emergency funds, and capital preservation. SIP is better for long-term wealth creation (7+ years) as equity historically delivers higher post-tax returns that beat inflation. A balanced portfolio should include both based on your financial goals.
Frequently Asked Questions
Find answers to common questions about this calculator below.
For retirement (15-30 year horizon), equity mutual funds via SIP historically deliver 3-5% higher returns than FDs after tax. A ₹10,000/month SIP at 12% for 30 years yields ₹3.5 crore vs FD at 7% yielding ₹1.2 crore. However, FDs provide stability, so a mix of both is ideal.
Over 5+ year periods, equity SIPs have historically given 10-15% returns compared to FD returns of 6-7.5%. However, SIP returns are not guaranteed and can be negative in the short term. FDs offer guaranteed but lower returns.
FDs are among the safest investments in India. Deposits up to ₹5 lakh per bank are insured by DICGC. However, FD returns may not keep pace with inflation after tax, resulting in loss of purchasing power over long periods.