At Maturity (Simple Interest)
Monthly (Compounding)
Quarterly (Compounding)
Annually (Compounding)
Total Interest Earned:$0.00
Final Balance at Maturity:$0.00
Term in Years:0 Years
Understanding Term Deposit Rates in Australia
A term deposit is a low-risk investment product commonly offered by Australian banks, credit unions, and building societies. It involves locking away a set amount of money (the principal) for a fixed period of time at a fixed interest rate. Unlike savings accounts where rates can fluctuate, a term deposit guarantees your return, making it a popular choice for conservative investors looking for certainty.
How This Calculator Works
This calculator helps you estimate the return on your investment based on current Australian market conditions. It takes into account the following specific factors:
Deposit Amount: The lump sum you intend to invest initially.
Interest Rate (p.a.): The annual percentage rate offered by the financial institution. In Australia, these rates are influenced by the RBA cash rate.
Investment Term: The duration you are willing to lock your funds away. Common terms range from 1 month to 5 years.
Payment Frequency: This determines how interest is calculated. "At Maturity" usually implies simple interest paid at the end. Monthly, Quarterly, or Annual options often imply compounding interest if the earnings are reinvested into the principal.
Simple vs. Compound Interest
It is crucial to understand how your bank pays interest.
At Maturity: Most short-term deposits (less than 12 months) pay simple interest calculated on the daily balance and paid in full when the term ends.
Compounding: For longer terms, or if you choose to reinvest monthly interest payments, you earn "interest on interest." This calculator assumes that if you select a monthly, quarterly, or annual frequency, the interest is compounded, yielding a slightly higher final balance.
The Financial Claims Scheme (FCS)
In Australia, the Government guarantees deposits up to $250,000 per account holder per authorised deposit-taking institution (ADI). This makes term deposits one of the safest places to store cash, provided you stay within these limits at any single banking group.
Disclaimer: This calculator is for educational purposes only. It assumes a constant interest rate and, where applicable, that interest payments are reinvested (compounded). Actual bank calculations may vary slightly based on day counts (e.g., 360 vs 365 days). It does not account for withholding tax or inflation. Please consult a qualified financial advisor before making investment decisions.
function calculateTermDeposit() {
// 1. Get input elements
var depositInput = document.getElementById('tdDeposit');
var rateInput = document.getElementById('tdRate');
var termInput = document.getElementById('tdTerm');
var termUnitInput = document.getElementById('tdTermUnit');
var frequencyInput = document.getElementById('tdFrequency');
var resultArea = document.getElementById('tdResultArea');
var interestDisplay = document.getElementById('tdTotalInterest');
var balanceDisplay = document.getElementById('tdFinalBalance');
var termDisplay = document.getElementById('tdTermDisplay');
// 2. Parse values
var principal = parseFloat(depositInput.value);
var ratePercent = parseFloat(rateInput.value);
var termValue = parseFloat(termInput.value);
var termUnit = termUnitInput.value;
var frequency = frequencyInput.value;
// 3. Validation
if (isNaN(principal) || principal <= 0) {
alert("Please enter a valid deposit amount.");
return;
}
if (isNaN(ratePercent) || ratePercent < 0) {
alert("Please enter a valid interest rate.");
return;
}
if (isNaN(termValue) || termValue <= 0) {
alert("Please enter a valid term length.");
return;
}
// 4. Normalize Time to Years
var timeInYears = 0;
if (termUnit === 'months') {
timeInYears = termValue / 12;
} else {
timeInYears = termValue;
}
// 5. Calculation Logic
var rateDecimal = ratePercent / 100;
var finalAmount = 0;
var totalInterest = 0;
// Logic split: Simple (Maturity) vs Compound (Periodic)
if (frequency === 'maturity') {
// Simple Interest Formula: A = P(1 + rt)
// Note: Standard AU Term Deposits usually calc simple interest if paid at maturity.
totalInterest = principal * rateDecimal * timeInYears;
finalAmount = principal + totalInterest;
} else {
// Compound Interest Formula: A = P(1 + r/n)^(nt)
var n = 1; // Default Annually
if (frequency === 'monthly') {
n = 12;
} else if (frequency === 'quarterly') {
n = 4;
} else if (frequency === 'annually') {
n = 1;
}
// Calculation
// exponent = n * timeInYears
var exponent = n * timeInYears;
var base = 1 + (rateDecimal / n);
finalAmount = principal * Math.pow(base, exponent);
totalInterest = finalAmount – principal;
}
// 6. Formatting Output (AUD Currency)
var formatter = new Intl.NumberFormat('en-AU', {
style: 'currency',
currency: 'AUD',
minimumFractionDigits: 2,
maximumFractionDigits: 2
});
// 7. Update DOM
interestDisplay.innerHTML = formatter.format(totalInterest);
balanceDisplay.innerHTML = formatter.format(finalAmount);
// Format term display (e.g. "1.5 Years")
termDisplay.innerHTML = timeInYears.toFixed(2) + " Years";
// Show results
resultArea.style.display = 'block';
}