RD Calculator
A recurring deposit (RD) lets you save a fixed amount every month with a bank and earn a fixed rate, which is a good way to build a habit. Banks add the interest every quarter. If you put ₹5,000 a month into a 5-year RD at 6.5%, you deposit ₹3,00,000 and get back ₹3,54,954: ₹54,954 is interest. Enter your own monthly amount, rate and tenure below to see yours, year by year.
- Each monthly ₹5,000 earns 6.5% compounded quarterly for the months it stays in the account.
- Maturity = sum over k = 1 to 60 of ₹5,000 × (1 + 6.5 ÷ 400)^((60 − k + 1) ÷ 3) = ₹3,54,954
- Your deposits: ₹3,00,000 (84.5%)
- Interest earned: ₹54,954 (15.5%)
| Year | Deposited in year | Interest in year | Balance at year end |
|---|---|---|---|
| Year 1 | ₹60,000 | ₹2,143 | ₹62,143 |
| Year 2 | ₹60,000 | ₹6,282 | ₹1,28,425 |
| Year 3 | ₹60,000 | ₹10,697 | ₹1,99,122 |
| Year 4 | ₹60,000 | ₹15,405 | ₹2,74,527 |
| Year 5 | ₹60,000 | ₹20,427 | ₹3,54,954 |
Read the guide: FD vs RD: Which Is Better for You? Returns, Tax and Rules Compared
How to use the rd calculator
- Enter the amount you will deposit every month.
- Enter the RD interest rate your bank quotes for your tenure. It can differ from the FD rate.
- Enter the tenure in years and extra months. Banks usually allow 6 months to 10 years.
- Read the maturity amount, your total deposits and the interest. The table shows how the balance grows each year.
Formula
Each monthly deposit earns interest for the months it stays in the account, with interest added every quarter:
Maturity = sum, for k = 1 to N, of D × (1 + r ÷ 400)(N − k + 1) ÷ 3
Here D is the monthly deposit, r is the yearly rate in %, and N is the number of months. The first deposit stays for all N months and the last for one month.
Banks differ in how they treat months that do not make a full quarter, so the amount on your receipt can differ by a small amount.
Worked examples
₹5,000 a month for 5 years at 6.5%
You deposit ₹3,00,000 and get ₹3,54,954. Interest is ₹54,954. At 7% instead, the maturity is ₹3,59,664, which is ₹4,710 more.
A short RD: ₹10,000 a month for 1 year
At 6.5% you deposit ₹1,20,000 and get ₹1,24,286, so interest is ₹4,286. A short RD earns little because most of the money stays only a few months.
A long RD: ₹5,000 a month for 10 years
At 6.5% you deposit ₹6,00,000 and get ₹8,44,940, so ₹2,44,940 is interest. Interest is about 29% of the maturity amount because the early deposits stay for many years.
A tenure with extra months
₹2,000 a month for 2 years and 6 months at 6.5% becomes ₹65,282 from ₹60,000 of deposits. The table shows the last row as a part year.
Common mistakes to avoid
- Missing monthly instalments. Banks charge a small penalty for a late RD deposit, and many banks close the account after several missed payments.
- Thinking the full tenure earns on the full amount. The last deposit stays for just one month, so the average money works for about half the tenure.
- Forgetting tax. RD interest is added to your income and taxed at your slab rate every year, and TDS applies once interest from a bank goes over the yearly limit.
- Choosing an RD when a SIP in a long-term fund or a PPF would suit a goal better. An RD is safe and fixed, but it grows slowly.
Frequently asked questions
How is RD interest calculated?
Most Indian banks compound RD interest every quarter. Each monthly deposit earns interest for the months it stays in the account. The formula is on this page, and the table shows the result year by year.
What is the difference between an RD and an FD?
An FD takes one lump sum today. An RD takes a fixed amount every month. The FD calculator works out a lump sum, and this one works out monthly deposits.
Is RD interest taxable?
Yes. RD interest is taxed at your slab rate as income from other sources. TDS at 10% applies if the interest you earn from one bank is above ₹50,000 in a year (₹1,00,000 for senior citizens). Use our income tax calculator to see your slab.
Is an RD safe?
Bank RDs are covered by DICGC deposit insurance up to ₹5 lakh per depositor per bank, with all your deposits at that bank counted together. Post office RDs are backed by the government.
What happens if I miss an RD instalment?
Banks charge a penalty, often a small amount per ₹100 per month of delay, and the rule varies by bank. Many banks close the RD after several missed instalments. Read your bank’s terms.
Can I close an RD early?
Usually yes, but you get a lower rate and may pay a penalty. Check your bank’s rules before you open the account.
Sources: DICGC — Deposit insurance (₹5 lakh cover) · India Post — Recurring Deposit account