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A Recurring Deposit (RD) is a popular term deposit offered by banks and financial institutions in India that enables individuals to save a fixed amount every month for a predetermined period. It encourages disciplined savings and is suitable for people with regular income. The interest earned on RDs is compounded quarterly, and the maturity amount includes both the principal and the accumulated interest.
RDs are preferred by risk-averse investors because they offer guaranteed returns, making them a safe option for achieving short- to medium-term financial goals like vacations, gadgets, school fees, or emergency funds.
RD interest is calculated using the following compound interest formula:
M = R × [(1 + i)n – 1] / (1 – (1 + i)-1/3)
Where:
M = Maturity amount
R = Monthly deposit amount
i = Interest rate / 400 (quarterly compounding)
n = Number of months
Since each installment earns interest for a different duration, accurate calculation is complex without a tool. Our RD calculator simplifies this by giving instant results based on user input.
RD tenure refers to the time duration for which monthly installments are made. Tenure can be as short as 6 months or as long as 10 years. The longer the tenure, the more interest you earn due to compounding.
Choose your tenure based on the financial goal you are saving for. For example, use a 12-month RD for short-term goals like a holiday, and a 5-year RD for long-term planning like home down payment or education.
Most banks allow premature withdrawal of RD, but there are penalties involved. The interest rate is revised to the applicable rate for the actual period the RD was held, and some banks may levy an additional penalty of 1% on the earned interest.
Partial withdrawals are not permitted. The entire RD must be closed if funds are needed. Always check your bank’s premature withdrawal rules before booking a long-term RD.
Interest earned on RD is fully taxable as per the investor’s income tax slab. There is no tax exemption under Section 80C. If the interest in a financial year exceeds ₹40,000 (₹50,000 for senior citizens), banks deduct TDS (Tax Deducted at Source) at 10%.
It is advisable to declare RD interest while filing ITR, even if TDS has been deducted, to avoid scrutiny and additional penalties.
Both RD and FD are fixed-income instruments, but they differ in how deposits are made. In an FD, a lump sum is invested at once, whereas in an RD, the investment is made in monthly installments.
FD generally earns slightly more interest than RD, as the full amount is invested from day one.
Our RD calculator at MoneyReload allows users to calculate expected maturity value and interest earned based on inputs like monthly deposit, tenure, and interest rate.
It is especially helpful for comparing different deposit scenarios and planning your savings efficiently without doing any manual math.
Enter the monthly amount you want to deposit, the annual interest rate offered by your bank, and your desired tenure. The tool will show the total interest earned and final maturity amount. You can use sliders to modify input values and instantly see new results.
This tool saves time and helps visualize how much wealth can be built through systematic saving over time.
Our calculator is not just fast, but intuitive and insightful. It offers detailed breakdowns, real-time updates, visual charts, and downloadable PDF reports. It also considers quarterly compounding accurately, unlike generic calculators that often use simple interest assumptions.
Whether you are a student, salaried professional, or retiree, our RD tool helps make better savings decisions with clarity and confidence.
Use our RD calculator to calculate recurring deposit interest. Simply input the monthly deposit amount, interest rate, and tenure, and the calculator will give you an estimate of the interest earned and maturity amount.
The maturity value of a recurring deposit is the total amount you will receive at the end of the tenure, including the principal and earned interest. Our RD calculator helps you determine the maturity value easily.
Yes, the interest earned on recurring deposits is taxable. It is added to your total income and taxed according to your applicable tax slab. Use our income tax calculator to estimate the tax on RD interest.
No, the monthly contribution in a recurring deposit is fixed for the entire tenure. However, you can open a new RD with a different amount. Use our RD calculator to calculate the results based on your fixed monthly deposit.
The interest on recurring deposits is compounded quarterly. Our RD calculator automatically accounts for this compounding when you input the relevant details.
The minimum tenure for a recurring deposit is generally 6 months, and the maximum can go up to 10 years. Check the RD calculator to calculate the interest for various tenure options.
Yes, you can withdraw a recurring deposit before its maturity, but it may come with penalties, and you will lose the interest rate benefits. Use our RD calculator to determine the impact of early withdrawal.
If you miss an RD installment, the bank may charge a penalty or may not pay interest on the missed amount. Always ensure timely payments for maximizing returns. Our RD calculator assumes timely payments in the results.
You can check your RD balance by visiting your bank’s website or mobile app. Alternatively, use our RD calculator to estimate the balance and maturity value based on your monthly contributions.
Interest earned on recurring deposits is taxable and will be added to your annual income. Use our income tax calculator to get an estimate of the tax on RD interest.
