RD Calculator (Recurring Deposit)
Calculate the maturity value, total deposits, and quarterly compounding interest earned on bank recurring deposits in India.
After 36 months at 6.8% p.a. quarterly compounding
*Interest is compounded quarterly per Indian banking norms. DICGC insurance covers up to ₹5 Lakhs.
Important Educational Disclaimer for Calculator Results:
Calculations are estimates based on your entered inputs and selected return or inflation assumptions. Results are illustrative, hypothetical, and not guaranteed. Actual market returns, interest rates, tax liabilities, and inflation rates will vary and may materially alter your final outcome. This calculator does not constitute financial, investment, or tax advice.
What does this Recurring Deposit outcome mean?
Depositing ₹5,000 every month for 36 months (3.0 years) amounts to a total out-of-pocket investment of ₹1,80,000. At 6.8% p.a. quarterly compounding, you earn ₹20,059 in interest, receiving a total maturity sum of ₹2,00,059.
- Indian banks compound RD interest quarterly (every 3 months), meaning your earlier installments compound for more quarters than later ones.
- RDs are ideal for fixed short-term goals (1–3 years) where capital preservation is paramount.
- Interest earned is fully taxable under 'Income from Other Sources' and is subject to 10% TDS if total bank interest exceeds ₹40,000/year (₹50,000 for seniors).
How This Calculator Works
In Indian banking, each monthly installment earns compound interest for the number of quarters remaining until maturity using the formula M = P × (1 + r/400)^(n/3).
M = P × [(1 + i)^n + (1 + i)^(n-1) + ... + (1 + i)]Variables in Formula:
Worked Step-by-Step Example
You save ₹5,000 per month in a 3-year (36 months) bank recurring deposit at 6.8% p.a. interest.
Key takeaway: Disciplined monthly savings of ₹5,000 builds an assured, risk-free ₹2.00 Lakhs cash reserve for your short-term goals.
Common Mistakes to Avoid
⚠ Missing monthly installments
Banks charge a penalty (usually ₹1.50 to ₹2.00 per ₹100 per month) for delayed or missed RD installments, eroding returns.
⚠ Using RD for 5+ year long term goals
Over 5+ years, inflation and taxes erode fixed deposit purchasing power. Equity SIPs historically provide superior inflation-beating real returns.
Frequently Asked Questions
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