RD Calculator
Calculate Recurring Deposit maturity amount and interest. Plan your monthly savings with accurate returns.
RD Details
Depositing $10,000 monthly for 3 years at 7% interest rate.
Maturity Amount
$401,373
After 3 years
Investment Breakdown
Quarter-wise Projection
| Quarter | Total Deposited | Interest Earned | Balance |
|---|---|---|---|
| Q1 | $30,000 | $349 | $30,349 |
| Q2 | $60,000 | $1,230 | $61,230 |
| Q3 | $90,000 | $2,651 | $92,651 |
| Q4 | $120,000 | $4,621 | $124,621 |
| Q5 | $150,000 | $7,152 | $157,152 |
| Q6 | $180,000 | $10,251 | $190,251 |
| Q7 | $210,000 | $13,930 | $223,930 |
| Q8 | $240,000 | $18,198 | $258,198 |
| Q9 | $270,000 | $23,066 | $293,066 |
| Q10 | $300,000 | $28,544 | $328,544 |
| Q11 | $330,000 | $34,642 | $364,642 |
| Q12 | $360,000 | $41,373 | $401,373 |
RD Key Features
- ✓Minimum tenure: 6 months
- ✓Maximum tenure: 10 years
- ✓Interest compounded quarterly (most banks)
- ✓Senior citizens get 0.5% extra interest
- !Interest is taxable as per income slab
- !TDS deducted if interest exceeds Rs.40,000/year
- ✓Premature withdrawal allowed with penalty
- ✓Loan facility available against RD
What is a Recurring Deposit (RD)?
A Recurring Deposit (RD) is a savings scheme offered by banks and post offices that allows you to deposit a fixed amount every month for a predetermined period. It combines the discipline of regular savings with the guaranteed returns of fixed deposits.
Key features of RD:
- Fixed monthly deposit: As low as Rs. 100 per month
- Tenure options: 6 months to 10 years
- Interest rates: Similar to FD rates (5.5-7.5%)
- Compounding: Quarterly in most banks
- Senior citizen benefit: 0.25-0.5% additional interest
- Guaranteed returns: Not market-linked
Who should consider RD:
- Salaried individuals wanting forced savings
- Risk-averse investors seeking guaranteed returns
- Those with regular income wanting to build a corpus
- Parents saving for children's future needs
RD Maturity Calculation Formula
RD interest is calculated using compound interest principles for recurring deposits:
RD Maturity Formula
Where:
- M= Maturity amount
- R= Monthly deposit amount
- r= Annual interest rate (as decimal)
- n= Compounding frequency (4 for quarterly)
- t= Tenure in years
Simplified Calculation Method
For practical purposes, many use this simplified formula:
Maturity = Monthly Deposit × No. of Months × (1 + Average Interest Factor)
How interest is calculated:
- Each monthly deposit earns interest for remaining period
- First deposit earns interest for full tenure
- Last deposit earns interest for one month only
- Average interest is approximately half the total interest rate
Example breakdown:
- For 12-month RD at 7%:
- Month 1 deposit earns 12 months interest
- Month 6 deposit earns 7 months interest
- Month 12 deposit earns 1 month interest
- Effective average: ~6.5 months of interest on each deposit
How to Use This Calculator
Our RD calculator helps you plan your recurring deposits:
- Enter Deposit Details:
- Monthly deposit amount
- Investment period (months/years)
- Interest rate (check current bank rates)
- Select Compounding:
- Quarterly (most common)
- Monthly (some banks)
- View Results:
- Maturity amount
- Total deposits
- Interest earned
- Month-by-month breakdown
Types of Recurring Deposits
Regular RD:
- Fixed monthly deposit, fixed tenure
- Offered by all banks
- Most common type
Flexi RD / Variable RD:
- Deposit amount can vary each month
- Set minimum and maximum limits
- Useful for variable income earners
Tax Saver RD (5-year):
- 5-year lock-in period
- Eligible for Section 80C deduction (post office only)
- Limited liquidity
Post Office RD:
- Sovereign guarantee (safer than bank RD)
- Competitive interest rates
- Available at all post offices
Premature Withdrawal and Penalties
Missed installment penalties:
- Penalty: Rs. 1-2 per Rs. 100 of monthly deposit
- Grace period: Usually 5 days
- Multiple defaults may lead to premature closure
- Auto-debit minimizes risk of missing deposits
Premature withdrawal:
- Allowed after 3 months in most banks
- Interest rate reduced by 0.5-1%
- Some banks may charge additional penalty
- Better to take loan against RD if possible
Loan against RD:
- Up to 90% of deposited amount
- Interest: 1-2% above RD rate
- RD continues to earn interest
- Better than premature withdrawal
Worked Examples
5-Year RD Calculation
Problem:
Calculate maturity for Rs. 5,000 monthly deposit at 7% for 5 years (quarterly compounding).
Solution Steps:
- 1Monthly deposit: Rs. 5,000
- 2Interest rate: 7% annually
- 3Tenure: 60 months (5 years)
- 4Compounding: Quarterly
- 5Total deposits: Rs. 5,000 × 60 = Rs. 3,00,000
- 6Interest earned (approx): Rs. 60,608
Result:
Maturity amount: Rs. 3,60,608. Interest earned: Rs. 60,608 on Rs. 3,00,000 invested.
Comparing RD with Different Tenures
Problem:
Compare Rs. 10,000/month RD for 1 year vs 3 years at 6.5%.
Solution Steps:
- 11-Year RD:
- 2Deposits: Rs. 1,20,000
- 3Interest: Rs. 4,238
- 4Maturity: Rs. 1,24,238
- 53-Year RD:
- 6Deposits: Rs. 3,60,000
- 7Interest: Rs. 37,860
- 8Maturity: Rs. 3,97,860
Result:
Longer tenure earns proportionally more interest due to compounding. The 3-year RD earns almost 9x the interest for 3x the deposits.
Senior Citizen RD Benefit
Problem:
Compare regular RD vs senior citizen RD for Rs. 15,000/month for 2 years. Regular: 6.5%, Senior: 7%.
Solution Steps:
- 1Regular RD at 6.5%:
- 2Deposits: Rs. 3,60,000
- 3Interest: Rs. 24,900
- 4Maturity: Rs. 3,84,900
- 5Senior Citizen at 7%:
- 6Deposits: Rs. 3,60,000
- 7Interest: Rs. 26,880
- 8Maturity: Rs. 3,86,880
Result:
Senior citizen earns Rs. 1,980 more (7.9% extra interest) on the same deposits. This benefit compounds more for longer tenures.
Tips & Best Practices
- ✓Set up auto-debit on salary credit day to never miss installments
- ✓Compare rates across banks - small finance banks often offer 1% higher rates
- ✓Post office RD has sovereign guarantee and competitive rates
- ✓Consider senior citizen RD rates if eligible (0.25-0.5% extra)
- ✓Avoid premature withdrawal - take loan against RD instead if needed
- ✓Split large RDs across banks for deposit insurance coverage
- ✓Tax planning: Consider timing interest credit near financial year-end
- ✓Flexi RD is useful if your monthly surplus varies
Frequently Asked Questions
Sources & References
- RBI Interest Rate Guidelines (2024)
- India Post - RD Scheme (2024)
- SBI - Recurring Deposit (2024)
Last updated: 2026-01-22