Periodic deposit

Periodic deposit is an investment made in form of equal deposits over a regular time period. Each deposit recurs after a time interval. Such an investment is made to achieve a pre-planned financial objective and/or when the available capital to invest is limited.

In simpler words, periodic deposit is a deposit recurring on a periodic basis. Investments are made over the period, grow over the period and mature at the end of the period.

Real world example

Periodic deposit performance chart based on real world example

John is planning investments for his retirement. He has decided to invest an amount of US$150.00 per pay check over a period of 30 years. He receives his pay check twice every month. The interest rate expected is 10% per annum with quarterly compounding.

Investment

Starting amount	Deposit mode	Periodic amount	Period	Interest rate	Compounding
US$0.00	Semi-monthly	US$150.00	30 year	10%	Quarterly

*All deposits made at start of the period

Returns

Invested amount	Interest accrued	Maturity amount	Gain
US$108,000.00	US$562,498.37	US$670,498.37	520.83%

See also

• Finance
• Interest
• Rate of return on investment
• Real interest rate
• Single deposit