Free Online RD Calculator

A Recurring Deposit is a savings product where you invest a fixed amount every month for a chosen tenure. The bank pays compound interest (usually quarterly) on your accumulated deposits. An RD calculator helps you determine the maturity amount by computing compound interest on each monthly installment from its deposit date until maturity, giving you the total corpus you will receive.

RD interest is compounded quarterly in India. Each monthly deposit earns interest from its deposit date. The standard formula uses quarterly compounding where the effective maturity is calculated as A = P x [(1+r/n)^(nt) - 1] / [1 - (1+r/n)^(-1/3)], where P is the monthly deposit, r is the annual rate, n is 4 (quarterly), and t is tenure in years. The first installment earns interest for the full tenure while the last earns for just one quarter.

RD requires fixed monthly deposits (starting Rs 500) while FD requires a one-time lump sum. FD earns more total interest because the full amount compounds from day one. RD is ideal for salaried individuals who want to build savings gradually. For the same total amount, FD gives higher maturity. Use our FD calculator to compare returns.

As of 2026, RD rates for 1-2 year tenure are approximately: SBI at 6.8%, HDFC Bank at 7.0%, ICICI Bank at 7.0%, Axis Bank at 6.9%, PNB at 6.8%, Post Office RD at 6.7% for 5 years. Senior citizens get 0.25-0.50% extra. Small finance banks offer up to 8% on RDs. These rates change periodically based on RBI monetary policy.

Yes, RD interest is fully taxable under "Income from Other Sources" at your slab rate. Banks deduct TDS at 10% when interest across all deposits exceeds Rs 40,000/year (Rs 50,000 for seniors). Post office RDs also attract TDS. You can submit Form 15G/15H to avoid TDS if your income is below the taxable limit. Report all RD interest in your ITR.

Yes, most banks allow premature closure of RD with a penalty of 0.5% to 1% on the applicable rate. Some banks may apply the rate for the completed period minus penalty. Post office RD can be prematurely closed after 3 years (for 5-year RD). Premature withdrawal results in lower effective returns. Some banks offer an overdraft facility against RD as an alternative to breaking it.

Missing an installment attracts a penalty, typically Rs 1 per Rs 100 per month of default. If you miss 3-4 consecutive installments, the RD account may be automatically closed by the bank, and you receive the accumulated amount with interest at a lower rate. Post office RD allows resumption within a specified period with penalty. Setting up auto-debit from your savings account prevents missed payments.

The minimum monthly RD installment is Rs 100 to Rs 500 depending on the bank. Post office RD starts at Rs 100 with multiples of Rs 10. Most banks accept up to Rs 1,00,000 per month for RD. There is no upper limit at most private banks. The deposit amount remains fixed throughout the tenure and cannot be changed mid-term.

Both require regular monthly investments. RD offers guaranteed returns of 6-7% with zero risk, while SIP in equity mutual funds historically delivers 12-14% but with market volatility. For short-term goals (1-3 years), RD is safer. For long-term goals (5+ years), SIP typically outperforms. A balanced approach uses RD for emergency fund and SIP for wealth creation. Compare with our SIP calculator.

Yes, NRIs can open RD in NRE or NRO accounts. NRE RD interest is tax-free in India and fully repatriable. NRO RD interest is taxable at 30% plus surcharge. Not all banks offer RD for NRE accounts, so check with your bank. The minimum tenure and amount may differ for NRI RDs. FCNR deposits are an alternative for NRIs wanting foreign currency denomination.

Post Office 5-Year Recurring Deposit offers around 6.7% interest compounded quarterly. Minimum deposit is Rs 100 per month with no maximum limit. It is backed by the Government of India making it extremely safe. The account can be transferred between post offices. Premature closure is allowed after 3 years. A rebate of 1% is given for advance quarterly payments. Interest is taxable and TDS applies.

PPF is superior for long-term savings due to its EEE tax status (investment deductible under 80C, interest tax-free, maturity tax-free) and higher effective post-tax returns. PPF currently offers 7.1% which is entirely tax-free. An RD at 7% in the 30% tax bracket yields only 4.9% post-tax. However, PPF has a 15-year lock-in while RD offers flexible tenures. Use RD for short-term goals and PPF for long-term savings.

With current RD rates around 6.5-7% and inflation at 5-6%, the real return is barely 1-2% before tax. After tax at 30%, your post-tax return of 4.5-4.9% may not even match inflation. This means your purchasing power erodes over time. To beat inflation, combine RD with equity investments through SIP. Keep 3-6 months expenses in RD as emergency fund and invest the rest in higher-return instruments.

No, the monthly installment amount in a regular RD is fixed at the time of opening and cannot be changed during the tenure. If you want to increase your savings, you can open a new RD account with the higher amount. Some banks offer Flex RD or Variable RD where you can deposit varying amounts each month, but these may have different interest rate structures.

Bank RDs are available for tenures ranging from 6 months to 10 years, with the most common options being 1, 2, 3, and 5 years. Post office RD has a fixed 5-year tenure only. The interest rate may vary by tenure, with longer tenures sometimes offering higher rates. Choose a tenure that aligns with your financial goal timeline.

TDS on RD is calculated on the total interest earned across all deposit accounts (FD + RD) at that bank in a financial year. If the total exceeds Rs 40,000 (Rs 50,000 for seniors), TDS at 10% is deducted. Banks calculate projected interest and deduct TDS proportionally. If PAN is not provided, TDS is deducted at 20%. The TDS amount reflects in your Form 26AS.

Most RDs are cumulative by default, meaning interest is reinvested and compounded until maturity. Some banks offer non-cumulative RDs where interest is credited periodically to your savings account. Cumulative RDs give higher total returns due to the compounding effect. Non-cumulative RDs are rare for recurring deposits and more common in fixed deposits for regular income needs.

Yes, most banks offer loans or overdraft against RD, typically up to 80-90% of the accumulated balance. The interest rate on such loans is 1-2% above the RD rate. This is a better option than breaking the RD prematurely since you continue earning interest on the full RD amount. The loan must be repaid by the RD maturity date.

Post-tax RD return = RD Interest Rate x (1 - Your Tax Rate/100). For example, at 7% RD rate in the 30% tax bracket: 7% x (1 - 0.30) = 4.9% post-tax return. For the 20% bracket: 7% x 0.80 = 5.6%. For income below Rs 4 lakh (new regime) or Rs 2.5 lakh (old regime), the effective rate remains 7% since no tax is payable. Use our income tax calculator to determine your tax bracket.

RD is a good tool for building an emergency fund systematically. Setting aside Rs 5,000-10,000 per month in a 12-month RD helps accumulate 3-6 months of expenses. However, once the emergency fund is built, consider moving it to a sweep-in FD or liquid mutual fund for better liquidity. RD works best in the accumulation phase since the penalty for premature withdrawal reduces its effectiveness as instant-access emergency money.

To open an RD, you need: a savings account with the bank (for auto-debit of installments), PAN card (mandatory if projected interest exceeds Rs 40,000), and completed KYC (Aadhaar, address proof). For post office RD, you need an account at the post office, identity proof, and address proof. Most banks allow online RD opening through net banking or mobile app if KYC is already completed.

Yes, joint RD accounts are available at most banks. The interest income is taxable in the hands of the first holder unless the investment comes proportionally from both. For TDS purposes, the first holder PAN is used. Joint accounts can have either-or-survivor or former-or-survivor nomination. This is useful for couples building savings together for shared financial goals.

Upon maturity, the total accumulated amount (deposits plus interest) is credited to your linked savings account. Some banks automatically renew the RD for the same tenure at the prevailing rate if you do not provide withdrawal instructions. Post office RD proceeds can be collected at the counter or credited to your post office savings account. Set a reminder before maturity to decide whether to withdraw, renew, or redirect the funds.

RDs are compounded quarterly in India. More frequent compounding gives higher returns. For Rs 10,000/month at 7% for 5 years: quarterly compounding yields approximately Rs 7,08,000 while monthly compounding would yield about Rs 7,12,000. The difference is small for RDs because deposits enter gradually. For lump sum deposits like FDs, compounding frequency has a larger impact.

Post office RD offers the security of government backing with no credit risk, but the rate (currently 6.7%) is lower than many private banks and small finance banks (7-8%). Bank RDs up to Rs 5 lakh are DICGC insured. Post office RD has a fixed 5-year tenure while banks offer flexible tenures. For maximum safety, post office RD is ideal. For better returns and flexible tenures, bank RDs are preferred.

Yes, you can open multiple RD accounts in the same bank or across different banks. This is useful for targeting different financial goals (vacation fund, down payment, etc.) with different tenures. Each RD earns interest independently. Remember that TDS applies on total interest across all accounts at a single bank, not per account.

Post office charges a penalty of Rs 1 per month for every Rs 100 of the monthly installment for late payments. For example, if your installment is Rs 5,000 and you are 1 month late, the penalty is Rs 50. If installments are not paid for more than 4 consecutive months, the account may be discontinued. The account can be revived by paying all due installments with penalties.

RD enforces monthly saving discipline through fixed automatic deductions. Unlike voluntary savings where you might skip months, auto-debit RD ensures consistent contributions. This rupee-cost-averaging approach builds a habit of saving first and spending what remains. Over time, even small monthly amounts compound significantly. Rs 5,000/month at 7% for 10 years grows to approximately Rs 8,65,000.

For goals within 6-12 months, liquid funds offer better liquidity (instant redemption up to Rs 50,000) and comparable returns of 6-7% with better tax efficiency for non-cumulative mode. For 1-3 year goals, RD gives guaranteed returns while liquid fund returns may fluctuate slightly. RD is simpler with no market risk. Liquid funds are better if you might need the money at unpredictable times.

The Post Office 5-Year RD currently offers approximately 6.7% compounded quarterly. This rate is reviewed and announced by the government each quarter. While lower than many private bank RDs, the post office deposit carries sovereign guarantee with zero credit risk. For tax-saving needs, the post office also offers 5-year Time Deposit qualifying under Section 80C.

Yes, a parent or guardian can open an RD account in the name of a minor child. Once the child turns 10, they can operate the account independently with guardian consent. After turning 18, the account is converted to the child name. The interest income is clubbed with the parent who has higher income, with a Rs 1,500 deduction per child under Section 10(32).

For Rs 5,000/month at 7% for 5 years (quarterly compounding): Total deposits = Rs 3,00,000. Using the RD maturity formula with quarterly compounding, the approximate maturity amount is Rs 3,54,000, earning Rs 54,000 in interest. The effective yield is slightly lower than FD because later deposits earn interest for shorter periods. Adjust the sliders above for your specific amount and rate.

RD interest is taxable, but you can reduce the impact by: submitting Form 15G/15H if income is below taxable limit, spreading deposits across banks to manage TDS, investing in PPF instead for tax-free returns, or claiming deductions under sections 80C and 80D to reduce your overall taxable income. There is no specific tax deduction available for RD investments unlike PPF or tax-saving FD.

Auto-renewal ensures your money stays invested without idle periods, which is convenient. However, it renews at the prevailing rate which might be lower than what you started with. Before renewal, check if better rates are available elsewhere or if you have a better use for the funds. Set a reminder before maturity to make an informed decision about renewal, partial withdrawal, or redeployment.

Rs 10,000/month at approximately 7% for 3 years (quarterly compounding): Total deposits = Rs 3,60,000. The approximate maturity amount is Rs 4,02,000, earning around Rs 42,000 in interest. Pre-tax effective rate is about 7% but post-tax (at 30% bracket) is about 4.9%. For comparison, the same amount in SIP at 12% could potentially grow to Rs 4,35,000, though with market risk.

Flexi RD (offered by select banks like SBI, ICICI) allows you to deposit variable amounts each month instead of a fixed sum, as long as it meets the minimum threshold. This offers flexibility during months when cash flow is tight. Interest rates and compounding are similar to regular RD. However, not all banks offer this product and the terms may differ. Regular RD enforces better savings discipline.