Recurring Deposit (RD) Calculator
Free online Recurring Deposit (RD) calculator. Calculate monthly deposit savings, quarterly compounded maturity returns, and total interest across Indian banks with ATS.
Key takeaways
- Recurring deposits combine disciplined monthly savings with guaranteed fixed deposit interest.
- Indian banks compound RD interest quarterly, with each installment earning interest for its remaining tenure.
- Ideal for salaried individuals building an emergency fund without lump-sum capital.
- Tenures typically range from 6 months to 10 years.
About the Recurring Deposit (RD) Calculator
A Recurring Deposit (RD) is a disciplined term-deposit mechanism where you deposit a fixed sum of money every month for a chosen tenure and earn a guaranteed interest rate equivalent to bank fixed deposits. It provides the disciplined savings habit of an SIP without exposure to stock market fluctuations.
In India, bank recurring deposits compound interest quarterly. Because you deposit funds incrementally each month, earlier installments compound for longer periods than later ones. The first installment earns interest for the entire tenure, while the final installment earns interest for just one month.
The ATS RD Calculator computes this installment-by-installment quarterly compounding series exactly, helping you budget monthly savings toward upcoming goals.
| Feature | Recurring Deposit (RD) | Mutual Fund SIP |
|---|---|---|
| Risk Level | Guaranteed by bank (Very Low) | Market-linked (Moderate to High) |
| Returns | Fixed (typically 6.5% to 7.5% p.a.) | Variable (historically 12% to 15% p.a. in equity) |
| Taxation | Taxed at investor slab rate; TDS applies | LTCG taxed at 12.5% above ₹1.25L; STCG at 20% |
| Best Suited For | Short-term goals & emergency funds (1–3 yrs) | Long-term wealth creation (5+ yrs) |
Worked example
- Monthly deposit = ₹5,000 | Interest rate = 7.00% p.a. | Tenure = 3 Years (36 months).
- Total amount deposited = 36 × ₹5,000 = ₹1,80,000.
- Quarterly compounding RD maturity value = ₹2,01,154.
- Total interest earned = ₹21,154.
Frequently Asked Questions
What is an RD calculator?
An RD calculator is a free financial tool that calculates the total interest earned and maturity payout on recurring monthly deposits in a bank or post office.
How is RD interest calculated in Indian banks?
Indian banks calculate RD returns by compounding interest quarterly on each individual monthly installment for the remaining duration of the tenure.
What is the minimum amount to open an RD?
Most Indian commercial banks permit opening an RD with as little as ₹500 or ₹1,000 per month, with no upper limit.
Is RD interest taxable in India?
Yes. Interest earned on an RD is added to your total income and taxed at your applicable slab rate. Banks deduct TDS at 10% if total annual interest across your deposits exceeds ₹40,000 (₹50,000 for senior citizens).
Can I miss a monthly RD payment?
Banks usually allow a grace period, but missing an installment can attract a minor penalty fee (typically ₹1 to ₹2 per ₹100 of installment).
Is RD better than Fixed Deposit?
RD is ideal if you want to save out of your monthly salary over time. Fixed Deposit (FD) is better if you already have a lump sum ready to invest.