A Recurring Deposit allows savers to accumulate capital by depositing a fixed monetary sum each month while earning term deposit interest rates. This calculator computes your maturity value and total interest earned across your deposit tenure.
📈 Recurring Deposit (RD) Calculator
Calculate accumulated savings and compounding interest on monthly Recurring Deposits.
Recurring Deposit (RD) Calculator: Monthly Savings Compound Planner
📋 What, Why, and Who Should Use It?
🔍 What is this Calculator?
A systematic banking savings calculator that computes interest returns and final maturity payouts for monthly recurring deposit accounts.
⚡ Why is it Useful?
Helps salaried savers build emergency reserves or short-term milestone funds through disciplined monthly deposits with quarterly compounding interest.
👥 Who Should Use It?
Salaried savers, students, and conservative depositors saving towards targeted short-to-medium term goals.
⚙️ How It Works & Calculation Formula
Calculates maturity value using the Indian banking quarterly compound interest formula on monthly recurring installments, taking into account the duration each individual monthly installment remains invested.
💡 Assumptions & Real-World Example
Assumes regular monthly deposits made on the due date and interest compounded quarterly in line with Indian commercial banking standards.
📌 FAQs
1. What is a Recurring Deposit (RD)? ▼
An RD is an investment vehicle offered by banks and post offices where you deposit a fixed amount every month for a chosen tenure, earning term deposit interest rates.
2. How is interest calculated on an RD? ▼
RD interest is calculated using quarterly compounding on each monthly installment based on the actual number of months that specific installment remains deposited.
3. Is interest earned on an RD subject to TDS? ▼
Yes. TDS is deducted at 10% if total interest earned on your term deposits (FD + RD) in a bank exceeds ₹40,000 per financial year (₹50,000 for senior citizens).
4. Can I change the monthly installment amount of an active RD? ▼
No. Once an RD is opened, the monthly installment amount, deposit date, and tenure are fixed and cannot be changed.
5. What happens if I miss an RD installment? ▼
Banks charge a small delayed payment penalty (typically ₹1.50 per ₹100 per month). If consecutive installments (typically 4 to 6 months) are missed, the bank may prematurely close the RD.
6. What are the minimum and maximum tenures for an RD? ▼
The minimum tenure in commercial banks is 6 months, and the maximum tenure is 10 years (120 months). Post Office RDs carry a standard fixed tenure of 5 years.
7. Can I close an RD prematurely? ▼
Yes. Most banks permit premature closure. The interest rate paid will be the rate applicable for the actual period the deposit was held, minus a 0.50% to 1.00% premature penalty.
8. Can I take a loan against an RD? ▼
Yes. Banks offer loan facilities or overdrafts up to 90% of the accumulated RD balance at an interest rate 1% to 2% above the RD rate.
9. Is there any tax-saving RD under Section 80C? ▼
No. Unlike 5-year Fixed Deposits, Recurring Deposits do not qualify for tax deductions under Section 80C.
10. Do senior citizens get higher interest on RDs? ▼
Yes. Senior citizens receive an additional 0.50% to 0.75% interest rate over regular depositor rates across all tenures.
