Deposits are one of the financial instruments that can be used to save money. Come on, learn how to calculate deposit interest so you know the benefits!
Apart from making money, knowing how to calculate deposit interest can also be a strategy for maximizing investment. Even though you can't take it for a certain time, at least you can find out how much profit you will get.
Come on, get to know deposits more deeply and how to calculate deposit interest below!
Definition of Deposit Interest
Deposits are investment products from banks that have a higher rate of return than savings. However, customers cannot withdraw their funds within a certain period of time. Deposits are used as medium risk instruments. This is because these savings are included in the guarantee of the LPS (Deposit Guarantee Agency).
Meanwhile, as reported by Investopedia, each bank that offers investment deposits provides different interest rates. However, deposit rates are generally still below the reference rate of Bank Indonesia (BI).
Banks also offer various deposit periods or tenors, ranging from one month, 3 months, 6 months to 12 months. Come on, get to know deposits more deeply and how to calculate deposit interest below!
As a substitute for other investment instruments, the advantages of deposits include:
- Can be used as collateral for credit
- Get interest yields which are generally higher than other forms of savings
- Able to manage finances more neatly in accordance with the term of the deposit and customer needs
- Guaranteed by the Deposit Insurance Corporation (LPS)
In addition to the advantages, you also need to consider the disadvantages of deposits, namely:
Relatively small gain
- Deposit interest is basically weak against inflation
- The customer is not directly involved in managing the funds
- Tax deposit is quite high
- How to Calculate Deposit Interest
You may be curious, how do you calculate interest on deposits with deposits reaching 100 million to 1 billion? Reporting from The Balance, there are two ways that can be used to calculate deposit interest per month.
The purpose of knowing how to calculate deposit interest yourself is to create a strategy so that deposit investments can generate more profits. With these additional benefits or benefits, Moms can certainly use the money for various needs, such as children's education.
Come on, learn how to calculate the following deposit interest!
1. Based on Total Income per Month
To find out the deposit interest every month, Moms can calculate deposit interest based on total income per month.
Here's how to calculate deposit interest:
Total Interest = (Total deposit x interest rate x 80% x 30 days) : 365 days
The 80% figure is obtained from the proportion of income that is deducted from the proportion of taxes that must be borne, which is between 100% -20%.
Take for example, you want to deposit a deposit of IDR 20,000,000 for 6 months.
At that time, the prevailing deposit rate was 6% with a 20% tax deduction.
So, how to calculate deposit interest per month is:
(Deposit amount x interest rate x 80% x 30 days) : 365 days
(Rp 20,000,000 x 6% x 80% x 30 days) : 365 days
28,800,000 : 365
= IDR 78,904
Based on calculations, the profit earned from interest each month is IDR 78,904.
Because Moms save deposits with a tenor of 6 months, the interest per month can be multiplied by 6 months to get the total interest you get.
2. Based on Total Income per Maturity
The next way to calculate deposit interest is based on total income per maturity. This method is used to calculate the total income you get each maturity. That way, you can find out the total amount of profit.
The formula for calculating deposit interest based on total income per maturity is:
Deposit Interest = Total deposits + (Profit from deposit interest – Total deposit tax)
Meanwhile, how to calculate the profit on deposits can use the following formula:
Benefits of Deposit Interest = (Total deposit x interest rate x total tenor): 365 days
Furthermore, the amount of tax received can be calculated by the formula:
Total Deposit Tax = Deposit interest gain x tax rate
Take for example, you deposit IDR 20,000,000 for a period of 6 months.
The deposit interest rate is set at 6% with a tax withdrawal that must be borne by 20%. So what must be calculated first is the profit from deposit interest, namely:
(Total deposit x interest rate x total tenor): 365 days
(Rp 20,000,000 x 6% x 180 days) : 365 days
= IDR 591,780
Then, you need to calculate the amount of tax deductions that must be borne, by:
Deposit interest gain x tax rate
IDR 591,780 x 20%
= IDR 118,356
If you have obtained the figure for the profit on deposit interest and the amount of tax deductions that must be borne, then you can start calculating the profit for deposit interest.
Deposit amount + (Deposit interest income – Deposit tax amount)
IDR 20,000,000 + (IDR 591,780 - IDR 118,356)
IDR 20,000,000 + IDR 473,424
So, those are some ways to calculate deposit interest that can be done easily. Happy investing for a brighter future. Source: orami 29