RD Calculator
Calculate the maturity value and total interest of your Recurring Deposit. Works for bank and post office RDs with quarterly compounding, plus a year-wise growth breakdown.
Calculate Your RD Maturity
Enter your monthly deposit, interest rate and tenure to see exactly how much your recurring deposit will grow.
What Is a Recurring Deposit (RD)?
A Recurring Deposit is one of the simplest and safest ways to build savings in India. Instead of investing a single lump sum, you commit to depositing a fixed amount every month for a chosen tenure — typically anywhere from 6 months to 10 years — and earn a guaranteed rate of interest on it. Offered by virtually every bank and by India Post, an RD is perfect for salaried individuals who want to convert a portion of their monthly income into disciplined, risk-free savings.
How RD Interest Is Calculated
RD interest in India is compounded quarterly. The key thing to understand is that each monthly installment is deposited at a different point in time, so every deposit earns interest for a different number of months. Your very first deposit earns interest for the entire tenure, while your last deposit earns interest for just one month. The maturity value is the sum of all these individually compounded deposits. Because this is fiddly to do by hand, our calculator simulates each month with quarterly compounding to give you an accurate figure.
The RD Maturity Formula
The textbook formula for RD maturity is:
M = P × [(1 + i)n − 1] / (1 − (1 + i)−1/3)
where P is the monthly installment, i is the quarterly interest rate (annual rate ÷ 4 ÷ 100), and n is the number of quarters in the tenure. This formula bakes in specific compounding assumptions, so the cleanest way to get an exact answer is to simulate the deposits — which is precisely what this tool does.
Worked Example
Suppose you deposit ₹5,000 every month for 5 years (60 months) at 7% per annum. Over the tenure you deposit a total of ₹3,00,000. Thanks to quarterly compounding, your maturity value comes to approximately ₹3,59,000 — meaning you earn around ₹59,000 in interest. The longer the tenure and the higher the rate, the larger this interest component becomes relative to your deposits.
RD vs FD: Which Should You Choose?
- Recurring Deposit: Best when you want to save gradually from monthly income and don't have a lump sum yet. Builds savings discipline.
- Fixed Deposit: Best when you already have a lump sum to invest. Because the full amount earns interest from day one, an FD of the same total value earns more than an RD.
- Interest rates: RD and FD rates are usually very similar at the same bank and tenure.
- Flexibility: Both allow premature withdrawal, usually with a small penalty.
Tips to Maximise Your RD Returns
- Compare rates: Small finance banks and post office RDs often offer higher rates than large public-sector banks.
- Senior citizens: Most banks add 0.25%–0.75% extra interest for senior citizens.
- Choose tenure wisely: Longer tenures generally carry higher rates and let compounding work harder.
- Avoid missed installments: Banks may levy a penalty for missed or delayed deposits, so automate the monthly transfer.
- Plan for tax: Remember that RD interest is fully taxable, so compare post-tax returns with tax-free options like PPF for long-term goals.
Taxation of RD Interest
Interest earned on a recurring deposit is fully taxable and added to your income under "Income from Other Sources". Banks deduct TDS at 10% once your total interest across all deposits crosses ₹40,000 in a financial year (₹50,000 for senior citizens). If your total income is below the taxable limit, you can submit Form 15G/15H to avoid TDS. For long-term, tax-free growth, instruments such as PPF or Sukanya Samriddhi may be more efficient than an RD.
Note: Results are estimates for educational purposes, assume a constant interest rate and quarterly compounding, and do not deduct tax. Confirm the exact rate and terms with your bank before opening an RD.
Frequently Asked Questions — RD Calculator
A Recurring Deposit is a savings instrument offered by banks and post offices where you deposit a fixed amount every month for a chosen tenure, earning a fixed interest rate. It is ideal for salaried individuals who want to build a corpus through small, disciplined monthly savings rather than a single lump sum. At maturity you receive your total deposits plus the accumulated interest.
RD interest is compounded quarterly in India. Because each monthly installment is deposited at a different time, every deposit earns interest for a different number of months. The maturity value is the sum of each installment compounded for its remaining tenure. This calculator handles that month-by-month so you get an accurate maturity figure rather than a rough estimate.
The standard formula is M = P × [(1 + i)^n − 1] / (1 − (1 + i)^(−1/3)), where P is the monthly installment, i is the quarterly interest rate (annual rate ÷ 4 ÷ 100) and n is the number of quarters. Because this formula assumes specific compounding conventions, our calculator instead simulates each monthly deposit with quarterly compounding for precise results.
In a Fixed Deposit (FD) you invest a single lump sum once and let it grow. In a Recurring Deposit (RD) you invest a fixed amount every month over the tenure. FDs suit people who already have a lump sum, while RDs suit those who want to save gradually from regular income. Interest rates are usually similar, but an FD earns more overall because the full amount is invested from day one.
Yes. Interest earned on a recurring deposit is fully taxable as per your income tax slab and must be declared under "Income from Other Sources". Banks deduct TDS at 10% if your total interest across deposits exceeds ₹40,000 in a financial year (₹50,000 for senior citizens). Post office RD interest is also taxable but TDS rules differ.
Most banks allow premature closure of an RD, but you will usually earn a lower interest rate and may pay a small penalty (typically 0.5%–1%). Some banks also offer a loan or overdraft of up to 80–90% of the RD balance, which can be a better option than breaking the deposit if you need short-term funds.