Fd Vs Ppf Calculator Malaysia

FD vs PPF Formulas:

\[ FD_{return} = principal \times (1 + \frac{fd_{rate}}{n})^{(n \times t)} \] \[ PPF_{return} = principal \times (1 + ppf_{rate})^{t} \]

Principal Amount:

MYR

FD Interest Rate:

(unitless)

PPF Interest Rate:

(unitless)

Compounding Frequency (FD):

compounds/year (unitless)

Investment Period:

years (unitless)

FD Return:

PPF Return:

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1. What is FD vs PPF Comparison?

This calculator compares returns between Fixed Deposits (FD) and Public Provident Fund (PPF) investments in Malaysia. It helps investors understand which option might yield better returns based on current interest rates and compounding frequency.

2. How Does the Calculator Work?

The calculator uses these formulas:

\[ FD_{return} = principal \times (1 + \frac{fd_{rate}}{n})^{(n \times t)} \] \[ PPF_{return} = principal \times (1 + ppf_{rate})^{t} \]

Where:

\( principal \) — Initial investment amount (MYR)
\( fd_{rate} \) — Fixed deposit annual interest rate (unitless)
\( ppf_{rate} \) — PPF annual interest rate (unitless)
\( n \) — FD compounding frequency per year (unitless)
\( t \) — Investment period in years (unitless)

Explanation: The FD formula accounts for compound interest with specified frequency, while PPF uses annual compounding.

3. Importance of Return Comparison

Details: Comparing FD and PPF returns helps Malaysian investors make informed decisions about where to allocate their savings for optimal growth while considering risk factors.

4. Using the Calculator

Tips: Enter principal amount in MYR, interest rates as decimals (e.g., 0.03 for 3%), compounding frequency (typically 1-12 for FD), and investment period in years.

5. Frequently Asked Questions (FAQ)

Q1: What's the difference between FD and PPF in Malaysia?
A: FDs are bank products with fixed tenure and interest, while PPF is a long-term government-backed savings scheme with tax benefits.

Q2: Which is safer - FD or PPF?
A: Both are low-risk, but PPF has government backing while FDs are covered by PIDM up to RM250,000 per bank.

Q3: What are typical interest rates?
A: FD rates vary by bank (typically 2-4%), while PPF rates are set by government (historically around 3-6%).

Q4: Are there tax differences?
A: PPF contributions may qualify for tax relief, while FD interest is taxable.

Q5: Which has better liquidity?
A: FDs typically offer better liquidity with shorter lock-in periods compared to PPF's 15-year minimum.