What is the RD Calculator?
A Recurring Deposit lets you deposit a fixed amount every month at a guaranteed interest rate. The FinanceDeck RD Calculator projects the exact maturity value and total interest earned so you can compare RDs from different banks and post offices in seconds.
RDs suit disciplined savers building an emergency fund, a short-term goal fund or the down payment on a car or gadget. Because deposits are monthly, RDs also let salaried people match savings to their pay cycle without a lump sum upfront.
How does it work?
The calculator compounds each monthly deposit quarterly for the remaining months until maturity, then sums them. This mirrors the exact method Indian banks use, so the number you see matches your bank statement to the rupee.
The magic of an RD is not the rate — it's the consistency. Even a modest ₹5,000/month RD at 6.7% builds around ₹3.6 lakh in five years, most of it from your own deposits, with steady interest layered on top.
A = Σ M × (1 + i)^((n − k + 1) / 3), where i = R/400Example
A ₹5,000 monthly RD at 6.7% for 5 years compounds quarterly on every instalment.
You deposit ₹3,00,000 in total. Maturity works out to about ₹3,58,000 — around ₹58,000 as pure interest, without any market risk.
Benefits
- ✓Guaranteed maturity value — zero market risk
- ✓Automates monthly savings from your salary account
- ✓Perfect for short-term goals (1–5 years)
- ✓Compare banks, post office and small finance bank rates
- ✓TDS-friendly for modest monthly amounts
Frequently Asked Questions
Can I withdraw before maturity?
Most banks allow premature closure with a small interest penalty. Some post office RDs restrict withdrawals in the first year.
Is RD interest taxable?
Yes. Interest is added to income and taxed at slab rate. Banks deduct TDS if annual interest crosses ₹40,000 per bank.
RD or SIP — which is better?
RD is safer but returns 6–7%; SIP in equity funds averages 10–12% long-term with volatility. Use RD for short-term needs, SIP for 5+ year goals.
What if I miss a monthly instalment?
Banks charge a small penalty (typically ₹1–2 per ₹100 per month of default) and may close the RD after repeated defaults.
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Learn more in the Learning Center
Deep-dive guides that explain the concepts behind the RD Calculator.