FD Laddering Calculator
Split your FD across multiple tenures - get liquidity every year, dodge rate cycles, and never break an FD again.
What it means
FD laddering splits a lump sum across multiple FDs with staggered maturity dates. One matures each year, giving you regular liquidity without breaking any FD (and losing 0.5–1% penalty). It also averages out interest rate cycles - you always have an FD renewing at current rates.
Each matured FD either funds expenses or gets reinvested at the longest tenure.
Worked example
₹5L split into 5 rungs (1, 2, 3, 4, 5 years) at 7.2% gives ₹5.16L, ₹5.68L, ₹6.25L, ₹6.88L, ₹7.57L - one matures every year.
Frequently asked questions
Why not just put everything in a 5-year FD?
Two reasons: (1) liquidity - you can't withdraw without penalty; (2) rate lock-in - if rates rise, you miss out for 5 years. Ladder gives you cash each year and lets you catch rising rates.
What's the ideal number of rungs?
For emergency corpus: 12 rungs, 1 month apart (flexi-FD behaviour). For longer-term savings: 5 rungs, 1 year apart is the sweet spot - manageable but flexible.
Should all FDs be in one bank?
Split across 2–3 banks to stay within the ₹5L DICGC cover per bank per depositor. Small finance banks offer 7.5–8% but use them only within DICGC limit.
FD ladder vs debt mutual fund?
Debt funds are more tax-efficient if held over 3 years (LTCG at 20% with indexation before 2023; now slab rate). FD wins on certainty and DICGC protection. For stable income post-retirement, FD ladder is cleaner.
How do I reinvest a maturing rung?
At maturity, deposit it as a new FD at the longest tenure in your ladder. This keeps the ladder structure intact and captures any rate hike.