A Savings Bank (SB) account is a fundamental banking product that allows individuals to save money securely while earning a modest amount of interest. The interest earned on your SB account is a key benefit that helps your money grow over time. This calculator helps you estimate the potential interest you could earn based on your deposit, the prevailing annual interest rate, and the duration your funds remain in the account.
How SB Account Interest is Calculated
The interest earned on a Savings Bank account is typically calculated using the Simple Interest formula. While some banks might have variations or specific conditions, the standard formula is:
Interest (I) = Principal (P) × Rate (R) × Time (T) / 100
Principal (P): This is the initial amount of money you deposit into your savings account. In our calculator, this is the "Initial Deposit Amount."
Rate (R): This is the annual interest rate offered by the bank, expressed as a percentage. It's the "Annual Interest Rate" you input.
Time (T): This is the duration for which the principal amount is kept in the savings account, measured in years. This is the "Time Period (Years)."
The result of this formula (I) represents the total interest earned over the specified period. To find the total amount in your account after the interest is added, you would add this interest to your initial principal:
Total Amount = Principal + Interest
It's important to note that banks often compound interest, meaning interest is calculated not just on the principal but also on the accumulated interest from previous periods. However, for a straightforward estimation for SB accounts over shorter periods, the simple interest calculation provides a good baseline understanding. For longer periods or accounts with specific compounding frequencies, the actual amount might vary slightly.
When to Use This Calculator
To estimate potential earnings on a new deposit.
To compare the interest earned over different time periods.
To understand how changes in the annual interest rate affect your savings.
To gauge the growth of your savings over the long term.
Always refer to your bank's official terms and conditions for the exact method of interest calculation and applicable rates.
function calculateInterest() {
var principal = parseFloat(document.getElementById("principal").value);
var annualRate = parseFloat(document.getElementById("annualRate").value);
var time = parseFloat(document.getElementById("time").value);
var resultDiv = document.getElementById("result");
if (isNaN(principal) || isNaN(annualRate) || isNaN(time) || principal <= 0 || annualRate < 0 || time <= 0) {
resultDiv.innerHTML = "Please enter valid positive numbers for all fields.";
return;
}
var interest = (principal * annualRate * time) / 100;
var totalAmount = principal + interest;
resultDiv.innerHTML = "Estimated Interest Earned: ₹" + interest.toFixed(2) + "" +
"Total Amount After Interest: ₹" + totalAmount.toFixed(2) + "";
}