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About Recurring Deposit Calculator
What is a Recurring Deposit (RD)?
A Recurring Deposit (RD) is a savings scheme offered by Indian banks and post offices that allows individuals to deposit a fixed amount every month for a chosen tenure. At the end of the tenure, the depositor receives the total deposited amount plus accumulated interest. RDs are ideal for salaried individuals who wish to build a disciplined savings habit without committing a large lump sum.
What is an RD Calculator?
An RD Calculator is a free online financial tool that instantly computes the maturity amount, total interest earned, effective yield, and inflation-adjusted returns on your Recurring Deposit. By entering monthly deposit, interest rate, tenure, and compounding frequency, you get accurate results matching major Indian bank calculations — in seconds.
RD Formula Explained
The standard Indian bank RD formula (quarterly compounding):
M = R × [(1 + i)^n − 1] / (1 − (1 + i)^(−1/3))Where M = Maturity Amount, R = Monthly Deposit, i = Rate per quarter (annual rate ÷ 4), n = Number of quarters. For general compounding: each instalment is compounded individually using M_k = R × (1 + r/n)^(n × remaining_years).
RD vs Fixed Deposit (FD)
An FD requires a one-time lump sum deposit, while an RD allows monthly instalments — making RDs accessible for salaried or monthly income earners. FDs generally offer marginally higher interest rates than equivalent RD tenures. However, RDs build financial discipline and are better suited for investors who cannot commit a large amount upfront.
RD vs SIP
RD offers guaranteed, risk-free returns at a fixed interest rate — your capital and returns are safe. SIP (Systematic Investment Plan) invests in mutual funds with market-linked returns that can significantly exceed RD rates over the long term but carries market risk. RD is ideal for conservative, short-to-medium term goals; SIP suits risk-tolerant long-term wealth creation.
Senior Citizen RD Benefits
Most Indian banks offer an additional 0.25% to 0.75% interest rate to senior citizens (aged 60+) on RDs. This calculator includes a Senior Citizen toggle that automatically adds the bonus rate to the calculation, helping retirees maximise their monthly savings returns.
TDS on RD Interest
As per Indian Income Tax rules, TDS (Tax Deducted at Source) at 10% is deducted on RD interest if the total interest income in a financial year exceeds ₹40,000 (₹50,000 for senior citizens). If your PAN is not submitted, TDS is 20%. Submit Form 15G (general) or 15H (senior citizens) to avoid TDS if your income is below the taxable threshold.
Investment Tips
- Set up auto-debit to ensure monthly deposits are never missed.
- Compare RD rates across banks — small finance banks often offer higher rates.
- Ladder multiple RDs with different tenures for liquidity and better rates.
- Submit Form 15G/15H to avoid TDS if your income is below the threshold.
- RD deposits up to ₹5 lakh are insured by DICGC.
Frequently Asked Questions
An RD Calculator is a free online tool that instantly computes the maturity amount, total interest earned, effective annual yield, and inflation-adjusted value of your Recurring Deposit based on your monthly instalment, interest rate, tenure, and compounding frequency.
The calculator uses the bank-standard RD compounding formula where each monthly instalment earns compound interest for its remaining tenure. The total maturity amount is the sum of all compounded instalments. Results are computed instantly without any page reload.
A Recurring Deposit (RD) is a savings scheme where you deposit a fixed amount every month for a chosen period. At maturity, you receive the total deposited amount plus accumulated interest. It's ideal for salaried individuals who want disciplined savings without lump-sum commitments.
Each monthly instalment is compounded individually for its remaining duration. For quarterly compounding (as used by most Indian banks), the formula is M = R × [(1+i)^n − 1] / [1 − (1+i)^(−1/3)], where i = quarterly rate, n = number of quarters, R = monthly instalment.
The maturity amount is calculated by compounding each monthly deposit for its remaining tenure. Total maturity = Sum of [R × (1 + r/n)^(n × t_k)] for all k instalments, where r = annual rate, n = compounding frequency per year, t_k = remaining time for instalment k.
The minimum monthly RD deposit varies by bank. Most public sector banks like SBI, PNB, and Bank of Baroda allow RDs starting from ₹100 per month. Private banks like HDFC and ICICI typically require ₹500 or ₹1,000 per month minimum.
Yes, premature withdrawal of RDs is allowed at most banks, but it attracts a penalty of 1% on the applicable interest rate. Some banks may not pay any interest if the RD is closed within 3 months of opening. Tax-saving RDs (if applicable) may have lock-in restrictions.
Yes, RD interest is fully taxable as "Income from Other Sources" as per your income tax slab. TDS at 10% is deducted if total interest income exceeds ₹40,000 per year (₹50,000 for senior citizens). You must declare RD interest income in your ITR even if TDS was not deducted.
TDS (Tax Deducted at Source) on RD is tax deducted by the bank before crediting interest. The standard rate is 10% with valid PAN, or 20% without PAN. Submit Form 15G (for general public) or Form 15H (for senior citizens) to avoid TDS if your total income is below the taxable limit.
Interest rates vary by bank and tenure. Small finance banks (e.g. Unity SFB, Utkarsh SFB, Jana SFB) often offer 8%–9%+ on RDs. Among major banks, rates typically range from 6.5%–7.5%. Always compare current rates before opening an RD as rates change periodically.
Yes. RDs in scheduled commercial banks are covered by DICGC (Deposit Insurance and Credit Guarantee Corporation) insurance up to ₹5 lakh per depositor per bank (principal + interest combined). RDs are considered one of the safest savings instruments in India.
Yes! Most banks offer senior citizens (aged 60+) an additional 0.25%–0.75% interest rate on RDs. Our calculator includes a Senior Citizen toggle that automatically factors in the additional rate so you can see the exact benefit.
For most investors, 12–24 months RDs offer a good balance of returns and flexibility. If you are saving for a specific goal (e.g. annual holiday, education fees), align the tenure with your goal date. Longer tenures (3–5 years) may offer slightly higher rates but reduce liquidity.
Yes. If your RD earns 7% but inflation is 6%, your real return is approximately 1%. After tax, it may turn negative. Our calculator shows the inflation-adjusted maturity value so you can assess actual purchasing power gained from your RD investment.
It depends on your cash flow. FDs suit lump-sum investors and typically offer marginally higher rates. RDs are better for salaried individuals who want to save monthly. Both are equally safe and regulated. Combine both strategies for optimal savings management.
RD offers guaranteed, risk-free returns — perfect for conservative investors or short-term goals (1–5 years). SIP in equity mutual funds can deliver significantly higher returns over long periods (10+ years) but with market risk. For risk-free certainty, RD wins; for long-term wealth creation, SIP often outperforms.
This calculator uses the exact compounding formula used by Indian banks including SBI, HDFC, ICICI, and others. Results match bank statements within 0.01% — differences may arise due to bank-specific day-count conventions for partial periods.
An online RD Calculator saves time, eliminates manual errors, lets you compare multiple scenarios instantly (different amounts, rates, tenures), and shows you inflation-adjusted real returns and after-tax returns — giving a complete picture of your investment before you commit.
No. The monthly instalment amount is fixed at the time of opening and cannot be changed during the RD tenure. If your financial situation changes, you can open a new RD with a different amount or opt for a Flexi-RD offered by some banks that allow variable deposits within a defined range.
Yes, this RD Calculator is completely free to use with no registration required. You can calculate unlimited RD scenarios and export results as PDF anytime.