FD for ₹1 Lakh Monthly Income — How Much to Invest
To earn ₹1,00,000 per month (₹12,00,000/year) from FD interest at 7.25% per annum, you need a principal deposit of approximately ₹1.66 Cr. This assumes a non-cumulative (monthly payout) fixed deposit. At higher rates or with senior citizen premiums, the required corpus drops. Use the calculator below to check with different rates.
Last updated: 24 May 2026, 10:00 AM IST
Maturity Amount
₹2.37 Cr
at 7.25% for 5 years (quarterly compounding)
₹1.66 Cr FD — Detailed Breakdown
A retired business owner wants ₹1 Lakh per month from FD interest alone — a passive income of ₹12 Lakh per year. At 7.25%, the required corpus is ₹1.66 Cr (calculation: ₹12,00,000 ÷ 7.25% = ₹1.66 Cr). This is a substantial sum, but achievable for senior citizens with retirement savings. If they can find a bank offering 7.50% (some private banks and post office), the required corpus drops to ₹1.60 Cr. With senior citizen rates of 7.75%, it drops further to ₹1.55 Cr. Important: TDS of 10% will be deducted since annual interest far exceeds ₹50,000. The net monthly payout after TDS would be ₹90,000. To receive the full ₹1 Lakh, either invest more or file ITR to claim refund if in a lower tax bracket. Splitting across multiple banks also helps manage DICGC insurance coverage (₹5 Lakh per bank).
Data Sources
- RBI — Master Direction on Interest Rates (2026) — www.rbi.org.in
- Bank Websites — Latest FD Rates (May 2026) — www.rbi.org.in
- Income Tax Act — TDS on FD Interest (2025) — incometaxindia.gov.in
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Important: This calculator provides estimates based on the inputs and assumptions you provide. Results are mathematical projections, not financial advice or recommendations. Actual outcomes will vary based on market conditions, policy changes, individual circumstances, and factors not captured by this tool. Verify all figures independently and consult qualified professionals before making financial decisions.
Founding Partner, Tykhe Ventures · Founder, Kompella Technologies
Founding Partner at Tykhe Ventures ($20M AUM, early-stage investing) and Founder of Kompella Technologies, which provides fractional CTO/CPO services to funded startups. NISM XIX-C certified. Built RupayWise because the financial tools available in India were either oversimplified or designed to sell you a product — not help you decide.
Frequently Asked Questions
How much FD needed for ₹1 lakh monthly income?
At 7.25%, you need approximately ₹1.66 Cr in FD to earn ₹1 Lakh per month in interest. At 7.50%, the required amount drops to ₹1.60 Cr.
Is ₹1 lakh monthly FD interest taxable?
Yes, FD interest is fully taxable at your income tax slab rate. TDS of 10% is deducted at source. Annual interest of ₹12 Lakh falls in higher tax brackets — effective tax can be 20–30%.
Which bank gives the best rate for large FD?
For deposits above ₹2 Crore, many banks offer slightly lower rates (bulk deposit rates). IDFC FIRST, IndusInd, and small finance banks often offer the best rates. Consider splitting across banks for DICGC coverage.
Can I get ₹1 lakh monthly from FD as a senior citizen?
Senior citizens get 0.25–0.50% higher rates. At 7.75%, you need about ₹1.55 Cr for ₹1 Lakh/month. The TDS threshold is also higher at ₹50,000.
Is FD the best option for ₹1 lakh monthly income?
FD is the safest but not the most efficient. SCSS (8.2%), POMIS, and debt mutual funds (SWP) can offer better post-tax returns. A mix of FD + SCSS + SWP provides both safety and tax efficiency.
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Disclaimer
This calculator provides estimates based on the interest rates and tenure shown. Actual maturity may vary based on the bank's specific compounding method and any rate revisions during the tenure. Bank rates are sourced from public data and may not reflect the latest changes — always confirm with your bank before investing. TDS is deducted at source if applicable. This is not financial advice. RupayWise is not a deposit broker or financial advisor.