MyFinCards

RD Calculator

A recurring deposit is not one deposit — it is as many deposits as it has instalments, each compounding quarterly for only the months it has left to run. That is why an RD at the same rate earns less than a fixed deposit, and this page shows you exactly how much less. Have the money up front? Use the FD calculator.

₹50,000
₹500₹10,00,000
6.5%
1%15%
3 Yr
1 Yr10 Yr
Invested amount₹18,00,000
Est. returns₹1,91,219
Total value₹19,91,219

What the Maturity Value is Made Of

After 36 Monthly Deposits

₹19,91,219

Each of your 36 instalments is its own deposit, compounding quarterly for only the time it has left — the first for 36 months, the last for one. That is why ₹18,00,000 drip-fed earns ₹1,91,219, where the same total in an FD on day one at the same 6.5% would earn ₹3,84,134. The ₹1,92,915 difference is not a worse rate — it is the money that was not in the bank yet.

Worked Example: ₹50,000 a Month for 3 Years

You deposit ₹50,000 every month for 3 years — 36 instalments totalling ₹18,00,000 — at 6.5% compounded quarterly. The bank treats each instalment separately, so the maturity value is the sum of 36 deposits of different ages rather than one calculation.

You deposit

₹18,00,000

₹50,000 × 36 months

Interest earned

₹1,91,219

10.62% of what you paid in

Maturity value

₹19,91,219

before TDS and tax

A missed instalment carries a penalty

Unlike a SIP, an RD is a contract for a fixed number of deposits. Banks charge a penalty for each missed month and may close the account after a few, paying out at a reduced rate. RD interest is also taxed at your slab rate as ordinary income, not as capital gains — in the 30% bracket this ₹1,91,219 is really about ₹1,33,853.

What this Calculator Does

It sums one deposit per monthly instalment, each compounded quarterly for its own remaining term, and splits the result into what you paid in and what the bank added. It also computes what the same total would have earned as a single fixed deposit on day one, so the cost of drip-feeding is visible rather than implied.

How to Use It

1

Set what you will deposit every month.

2

Set the rate the bank is quoting and the tenure in years.

3

Read the maturity value and the interest earned.

4

Compare against the FD figure in the note below — the gap is the money that was not in the bank yet.

What It Does Not Include

An RD is a contract for a fixed number of deposits, so a missed instalment carries a penalty and repeated misses can close the account at a reduced rate — none of that is modelled here. RD interest is taxed as ordinary income at your slab rate, and TDS applies once interest crosses ₹50,000 in a year.

Expert FAQ

Frequently Asked Questions

Each monthly instalment is treated as its own deposit compounding quarterly for the time it has left. The first instalment compounds for the full tenure and the last for one month, so the maturity value is the sum of all of them rather than a single calculation.
Because the money is not all in the bank from day one. Over a three-year RD the average instalment has been invested for about eighteen months, not thirty-six. The rate is identical; the time is not.
They answer different questions. An RD gives a contractual rate and capital protection; a SIP gives a market return with no guarantee. Over long periods equity SIPs have beaten RD rates substantially, but an RD cannot lose money. For a goal under three years, the RD is usually the sounder choice.
Banks charge a penalty for each missed month, typically a small amount per ₹100 of instalment. After a few consecutive misses the bank can close the account prematurely and pay out at a reduced rate. Unlike a SIP, there is no option to simply skip a month.
Yes, as ordinary income at your slab rate, in the year it accrues. TDS at 10% applies once interest paid to you crosses ₹50,000 in a financial year. There is no indexation and no capital gains treatment.
You can close it, but not partially withdraw. Premature closure pays the rate applicable to the period it actually ran, minus a penalty of typically 0.5% to 1%. Some banks offer a loan against the RD balance instead, which avoids breaking it.
Most banks accept ₹100 to ₹500 a month as a minimum, with no practical maximum. Tenures usually run from six months to ten years, in multiples of three months.
The compounding convention is the same — quarterly — though the rate is set by the government rather than the bank and revised each quarter. The five-year post office RD is the standard product; this calculator works for it if you enter the current rate.
Longer tenures usually carry a slightly higher rate, but they also lock in that rate. If rates are rising, a shorter RD rolled over may finish ahead. The difference is normally small enough that the ability to access the money matters more.
No. The instalment is fixed for the life of the deposit. To save more you open a second RD, which is also a reasonable way to ladder maturity dates rather than having everything arrive at once.