National Saving Calculator

Post-pandemic, the average savings of an Indian household have decreased. In such cases, investing in less risky investment avenues comes in handy. And when it comes to safe investment options with decent interest rates, National Savings Certificates strike our mind. Let us learn about them in detail in this guide.

What is a National Savings Certificate (NSC)?

The National Savings Certificate (NSC) is a savings scheme initiated by the Government of India. NSC is a fixed-income investment scheme encouraging low or mid-income investors to invest funds and save taxes.

It is a government savings bond ideal for investors willing to invest in small amounts.

These certificates are available for purchase through any post office branch across India. These investments earn a fixed income as decided by the government. The interests get compounded annually, meaning that the previous year's interest amount is added to the principal amount to calculate interest for the current year.

You can avail of tax exemption on the interest component under section 80C of the Income Tax Act. The maturity period of these certificates is 5 years.

Features/Benefits of these certificates are:

• Fixed interest rates
• Backed by Government
• Tax benefits under section 80c
• Interest compounded annually
• Fixed maturity period
• Negligible risk involved
• Small investment amounts

What is a National Savings Certificate (NSC) Calculator?

A National Savings Certificate calculator is an online tool that helps you calculate the maturity amount of investments towards the scheme. It considers factors like the amount invested, interest rates and investment tenure.

The objective of the NSC calculator is to provide you with an estimate of the potential amount you might receive after 5 years.

These NSC calculators are an excellent way to estimate returns on investments. Without doing anything manually, you can compare different schemes and choose the one that aligns with your goals.

How Does the NSC Maturity Calculator Help You?

1. It can help you calculate the maturity value of investments. You can also use the data to decide whether or not to invest in the scheme.
2. It can help you estimate the returns on investments. You can utilise this information in comparing the scheme with other investment options.
3. It can also aid you in planning your investments. You can use the calculator to compute how much you should invest monthly to reach the desired maturity value.
4. An NSC interest rate calculator can support you in assessing the impact of different interest rates on your overall returns. It will aid you in deciding when to invest to get the maximum possible returns.
5. It can aid you in making wise financial and investment decisions.

How Does the NSC Maturity Calculator Work?

The NSC maturity calculator uses the compound interest or future value formula. It takes into account the following factors to calculate the maturity amount:

• Current NSC interest rates
• Investment amount
• Investment tenure

The NSC return calculator applies a predetermined interest rate to the principal amount for a certain period. Then, it adds interest to the principal amount to calculate the maturity amount.

The formula used is:

Maturity amount = Principal amount * (1 + Interest rate / 100) ^ Number of years

Note: It is essential to use accurate interest rates to get precise results. Also, tax implications and compounding frequency can impact your results.

How to Use Shriram NSC Return Calculator?

To calculate the NSC maturity amount, use Shriram’s NSC return calculator as per the given instructions. 

Step 1: Open Shriram’s official website and go to the calculator section. Open the NSC calculator. 

Step 2: Within the calculator interface, input your monthly investment sum.

Step 3: Now, enter the prevailing interest rates, as shared by the government, such as 7.7%.

Step 4: Continue by inputting the investment duration, e.g., 5 years.

Step 5: Complete the process by selecting Done or Enter.

Once you fill in all the needed data and press enter, you can see your earnings on the amount invested. You can see the maturity amount, the money you will receive when NSC matures.

NSC Return Calculation Formula

Use the formula to calculate the NSC maturity amount or returns:

M = P(1 + R/100) ^ N

Here, M is the maturity amount you could receive. P is the principal amount invested in the scheme. R is the prevailing rate of interest the authorities set. N is the number of years or the investment tenure.

Let us say you invested 1 lakh in the NSC scheme for 5 years at an interest rate of 7%. Your maturity amount using the formula would be around ₹ 1,40,255. The total interest earned by you will be around ₹ 40,255.

Benefits of Using the National Savings Certificate Calculator

There are many benefits of using a National Savings Certificate Interest Rate Calculator. A few of them are listed below.

1. Accuracy: These NSC investment calculators show near to accurate results. It means that you can confidently use them to calculate the maturity amount of your investments
2. Free to use: NSC yearly interest rate calculators are freely available on the web, and you can use them as much as you want without paying a penny.
3. Time-saving: Doing complex manual calculations takes up a considerable chunk of time. NSC investment calculators do all the calculations in a few seconds. 
4. Assists in decision-making: You can calculate investment returns using the NSC calculators online. It aids you in making wise financial decisions.
5. Ease of use: You do not need to be good at numbers to use calculators. NSC calculators online are easy to use, and instructions to use them are clear. 

NSC Interest Rates and Maturity Period

The NSC scheme comes with a fixed interest rate set by the government of India. The prevailing interest rate for this quarter is 7.7% p.a. The interest rates keep changing depending upon the decisions given by the finance ministry. Generally, they range from 6-8%. Also, keep in mind that interest is compounded annually.

Maturity Period: The maturity period of these investments is 5 years under the VIII issue. You cannot prematurely withdraw. Nevertheless, under exceptional circumstances like the demise of the holder or a court-issued directive, premature withdrawal of NSC funds can occur.

Final Words

NSC is an excellent investment avenue for individuals willing to invest in small amounts and have a low-risk tolerance. Moreover, online calculators have made complex calculations easy for you. However, you should consult your financial advisor before making any financial decisions.