What is a Recurring Deposit (RD)?
A Recurring Deposit (RD) is a type of term deposit offered by banks and post offices in which you deposit a fixed amount every month for a predetermined period. At the end of the tenure, you receive the maturity amount, which includes your total deposits plus interest earned. RDs are popular for their flexibility, low risk, and guaranteed returns, making them ideal for disciplined savings.
How is interest calculated on an RD?
Interest on an RD is typically compounded quarterly. Each monthly deposit earns interest for the remaining period of the RD. The formula for RD maturity is: M = P × n + P × n(n+1)/2 × r/(4×100) where M = maturity value, P = monthly deposit, n = number of quarters, r = rate of interest per annum. The actual calculation may vary slightly by bank or institution.
Can I use this calculator for any bank or post office RD?
Yes, this calculator is designed to work for all Indian banks and post office RDs. Just enter your monthly deposit, interest rate, and tenure. The tool will compute the maturity and interest based on standard compounding rules. Always check with your bank for the exact rate and compounding frequency.
Is the interest earned on RD taxable?
Yes, the interest earned on an RD is fully taxable as per your income tax slab. Banks may deduct TDS (Tax Deducted at Source) if the total interest exceeds a certain threshold in a financial year. You should declare RD interest income while filing your tax returns.
What is the minimum and maximum tenure for an RD?
The minimum tenure for an RD is usually 6 months, and the maximum can go up to 10 years, depending on the bank or post office. You can choose a tenure that matches your savings goal. Some banks may offer flexible RDs with variable tenures and deposit amounts.
Can I withdraw my RD before maturity?
Yes, premature withdrawal is allowed, but you may receive a lower interest rate and may have to pay a penalty. The terms and penalty rates vary by institution. It’s best to check with your bank or post office before breaking your RD.
What happens if I miss an RD installment?
Missing an RD installment may attract a penalty, and the maturity value may be reduced. Some banks allow a grace period for late payments, while others may close the RD if multiple installments are missed. Always try to pay on time to maximize your returns.
How do I choose the best RD scheme?
Compare interest rates, compounding frequency, tenure options, and penalties for premature withdrawal across banks and post offices. Consider your savings goal, liquidity needs, and risk appetite. Use this calculator to estimate returns for different scenarios.
Can NRIs open an RD account?
Yes, many banks in India allow Non-Resident Indians (NRIs) to open NRE or NRO RD accounts. The rules, interest rates, and tax implications may differ from resident accounts. Check with your bank for eligibility and documentation requirements.
What documents are required to open an RD?
Typically, you need identity proof (Aadhaar, PAN, passport), address proof, and a passport-size photograph. For online RDs, you may need to complete e-KYC. NRIs may need to provide additional documents such as visa, overseas address proof, and NRI status proof.
Can I change the monthly deposit amount in an RD?
Standard RDs require a fixed monthly deposit. Some banks offer Flexi or Variable RDs, where you can change the deposit amount each month within a specified range. Check with your bank for such options if you want flexibility.
How do I track my RD maturity and interest?
You can use this calculator to estimate your maturity and interest at any time. Banks also provide RD passbooks, online statements, and SMS/email alerts to help you track your RD progress and maturity date.
Are there any charges or fees for opening or maintaining an RD?
Most banks do not charge any fees for opening or maintaining an RD. However, penalties may apply for missed installments or premature closure. Always read the terms and conditions before opening an RD account.
What is the difference between RD and FD?
In an RD, you deposit a fixed amount every month, while in a Fixed Deposit (FD), you deposit a lump sum once. Both offer fixed returns, but RDs are better for regular savers, while FDs suit those with a large sum to invest at once. Interest rates and compounding may also differ.
Can I open multiple RDs at the same time?
Yes, you can open multiple RD accounts with the same or different banks to meet various savings goals. Each RD will have its own terms, interest rate, and maturity date.
How do I use this RD calculator?
Enter your monthly deposit, interest rate, and tenure in months. The calculator will instantly show your total deposit, interest earned, and maturity amount. You can also view a period-wise breakdown and charts for better understanding.
Is this RD calculator free and private?
Yes, this tool is 100% free to use and does not store or share your data. No login or registration is required. Enjoy fast, private, and ad-free calculations anytime.
Can I download or share my RD calculation results?
Yes, you can copy, download, print, or share your results instantly using the built-in options. This makes it easy to keep records or share with family, friends, or financial advisors.
What are the benefits of saving through an RD?
RDs encourage regular savings, offer guaranteed returns, and are low risk. They are ideal for building an emergency fund, saving for short-term goals, or teaching children the value of disciplined saving. RDs are also easy to open and manage online or offline.
Where can I get more help or information?
If you have more questions, use the chatbot on this page or contact your bank for specific RD policies. You can also explore the Tips & Glossary section below for more details on RD terms and features.