RD Calculator

How the RD Calculator works

A Recurring Deposit (RD) lets you deposit a fixed amount every month for a chosen tenure at a fixed interest rate. Like a Fixed Deposit, the rate is locked in when you open the account, so the return is predictable. It is a disciplined way to build savings toward a short-term goal. Enter your monthly deposit, the annual interest rate and the tenure to see your maturity value and total interest.

Formula used

• M = Maturity value
• R = Monthly deposit (instalment)
• i = Quarterly interest rate = annual rate ÷ 400
• n = Number of quarters = tenure in years × 4

This is the standard formula used by banks: deposits are made every month but interest is compounded quarterly, and each instalment earns interest for the remaining tenure — so earlier deposits grow the most.

Worked example

Depositing ₹5,000 every month at 7% p.a. for 5 years means you contribute ₹3,00,000 in total. With quarterly compounding the deposit matures at about ₹3,59,664, giving roughly ₹59,664 in interest. A longer tenure or higher rate increases the maturity noticeably, because interest keeps compounding on the growing balance.

Things to keep in mind

• Interest earned on an RD is taxable, and banks deduct TDS once your interest crosses the prescribed threshold, so the amount credited can be lower than shown.
• The maturity value assumes every instalment is paid on time for the full tenure. Missed or delayed instalments usually attract a small penalty and reduce the final amount.
• Rates vary by bank and tenure, and senior citizens typically earn a slightly higher rate, so treat this as a planning estimate and confirm the exact rate with your bank.