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RD Calculator (Recurring Deposit)
Plan your Monthly Savings with Accurate Returns
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%
M
💡 Tip: Minimum tenure is usually 6 months, maximum 10 years (120 months).
Senior Citizen?
Adds +0.50% extra interest
Total Investment:
₹0
Interest Earned:
₹0
Maturity Value
₹0
Invested
Returns
What is Recurring Deposit (RD)?
A Recurring Deposit (RD) is a term deposit offered by banks that allows people with regular incomes to deposit a fixed amount every month into their RD account and earn interest at the rate applicable to Fixed Deposits.
📌 How RD Interest is Calculated
Unlike Fixed Deposits where you invest a lump sum, in RD you invest monthly. The interest is compounded Quarterly. This calculator uses the precise formula used by Indian banks:
- Formula: Based on the compounding of each monthly installment for the remaining quarters.
- TDS: Tax Deducted at Source (TDS) is applicable on interest earned if it exceeds ₹40,000 (₹50,000 for seniors) in a financial year.
📊 RD vs SIP Comparison
| Feature | Recurring Deposit (RD) | SIP (Mutual Funds) |
|---|---|---|
| Risk | Zero Risk (Guaranteed Returns) | Market Risk (High/Medium) |
| Returns | 6% – 7.5% (Fixed) | 10% – 15% (Variable) |
| Liquidity | Penalty on premature withdrawal | High (Exit load may apply) |
❓ Frequently Asked Questions
Is RD interest taxable?
Yes, interest earned on RD is fully taxable as per your income tax slab. Banks also deduct 10% TDS if the interest income exceeds the threshold limit in a year.
What is the minimum amount for RD?
Most banks allow you to start an RD with as little as ₹100 per month (Public Sector Banks) or ₹500 (Private Banks).
Can I miss a monthly installment?
If you miss an installment, banks typically charge a penalty (around ₹1.50 per ₹100 per month). Continuous defaults might lead to the closure of the account.
Can I withdraw RD money before maturity?
Yes, premature withdrawal is allowed, but it usually attracts a penalty of 0.5% to 1% deduction on the interest rate.
Is the interest rate fixed for the entire tenure?
Yes, the interest rate is locked at the time of opening the account. Even if bank rates change later, your RD will continue to earn the rate decided at the start.