RD Calculator - Recurring Deposit Returns

How to Use the RD Calculator

Monthly Deposit

Enter the fixed amount you want to save every month.

Interest Rate

Enter the bank or post office annual interest rate.

Tenure

Select your deposit duration in months or years.

Maturity Output

Instantly see total deposits, interest, and maturity sum.

Recurring Deposit (RD) Calculator: Build Wealth Monthly with Guaranteed Returns

A Recurring Deposit (RD) is an ideal systematic investment tool for salaried individuals and disciplined savers who want guaranteed, risk-free returns without committing a large upfront lump sum. By depositing a fixed amount every month into your bank or Post Office RD, you earn quarterly compounded interest over tenures ranging from 6 months to 10 years. Our free RD calculator computes exact maturity values and cumulative interest earnings in real time.

Last updated 11 September 2026Maintained by the LoanFlow24 editorial teamRuns entirely in your browser — no data is sent or stored

Recurring Deposit Calculation Formula (Quarterly Compounding)

Indian banks calculate Recurring Deposit maturity using the Indian Banks' Association (IBA) quarterly compounding formula:

            M = P × [(1 + i)n - 1] / [1 - (1 + i)-1/3]
          

M: Final Maturity Value of the Recurring Deposit.
P: Monthly Installment Amount (e.g., ₹1,000, ₹5,000, or ₹25,000 per month).
i: Quarterly Interest Rate = Annual Rate / 400.
n: Number of Quarters in the investment tenure (e.g. 1 Year = 4 quarters, 5 Years = 20 quarters).

RD Returns Table: Monthly Deposit Growth at 7.00% Interest

Monthly Installment	1 Year Maturity	3 Year Maturity	5 Year Maturity	Total 5-Yr Interest
₹2,000 / month	₹24,920	₹80,285	₹1,43,785	₹23,785
₹5,000 / month	₹62,300	₹2,00,712	₹3,59,463	₹59,463
₹10,000 / month	₹1,24,600	₹4,01,424	₹7,18,926	₹1,18,926
₹25,000 / month	₹3,11,500	₹10,03,560	₹17,97,315	₹2,97,315

RD vs SIP vs Post Office RD: Choosing the Best Monthly Plan

Bank RD vs Post Office RD: Bank RDs offer flexible tenures from 6 months to 10 years, while Post Office RDs have a mandatory 5-year tenure (with attractive quarterly reviewed interest rates and sovereign guarantee).
RD vs Mutual Fund SIP: RDs offer 100% guaranteed, capital-protected returns (ideal for short-term goals within 1–3 years like buying a car or paying annual school fees). Mutual fund SIPs are market-linked but offer higher expected returns (12%–15%) for long-term wealth creation (5+ years). Check our companion SIP Calculator.

Tax Rules for Recurring Deposits (TDS & Slabs)

Under Section 194A of the Income Tax Act, interest earned on Recurring Deposits is subject to Tax Deducted at Source (TDS):

TDS Threshold: Banks deduct 10% TDS if cumulative interest from FDs and RDs exceeds ₹40,000 per financial year (₹50,000 for senior citizens).
Tax Slab Liability: Total RD interest earned is fully taxable according to your applicable income tax slab under "Income from Other Sources".
Premature Closure: Most banks allow early closure of RDs with a penalty of 0.50% to 1.00% deduction on the effective interest rate for the period held.

Practical Case Study: ₹10,000/Month RD Over 5 Years at 7.25%

Let us analyze a salaried individual investing ₹10,000 every month into a 5-year bank recurring deposit:

Total Cumulative Deposits: ₹10,000 × 60 months = ₹6,00,000
Total Compound Interest Earned: ₹1,24,680
Final Maturity Payout: ₹7,24,680
Effective Annual Yield: Approximately 8.12% on cumulative principal.

4 Smart Tips for Managing Recurring Deposits

Set Up Auto-Debit: Link your RD installment to your salary account on your pay date to prevent missed installment penalties.
Split Across Multiple Small RDs: Instead of one ₹20,000/month RD, open two ₹10,000/month RDs. If you face an emergency, you can liquidate one without disturbing the other.
Check Post Office RD National Schemes: Post Office RDs offer guaranteed quarterly reviewed rates backed directly by the Government of India.
Utilize Loan Against RD: Banks sanction loans up to 90% of your accumulated RD balance at low interest rates without breaking your compounding cycle.

Frequently Asked Questions

What is a Recurring Deposit (RD)?

An RD is a term deposit offered by Indian banks where you deposit a fixed amount every month for a specific tenure and earn interest on it. It is a great way to build a corpus over time with small regular savings.

How is RD interest calculated?

RD interest is typically compounded quarterly. The interest is calculated on the amount deposited in each month and then added to the principal to generate compound interest for subsequent quarters.

RD vs FD - which is better?

RD is ideal if you have a regular monthly income and want to save a portion of it consistently. FD is better if you have a lump sum amount readily available to invest at once.

What is the minimum RD amount?

Most banks in India allow you to start an RD with a minimum deposit of just ₹100 or ₹500 per month. The maximum amount varies by bank but is generally quite high or uncapped.

Is premature withdrawal allowed in RD?

Yes, premature withdrawal of an RD is usually allowed, but banks typically charge a penalty of 1% to 2% on the interest rate. Partial withdrawals are generally not permitted.

RD vs SIP - what should I choose?

RD offers guaranteed returns and capital protection, making it low risk. SIPs in mutual funds are market-linked and carry higher risk but offer the potential for higher inflation-beating returns over the long term.

How is tax calculated on RD?

The interest earned on an RD is fully taxable as per your income tax slab. Banks will deduct TDS at 10% if the interest earned across all branches exceeds ₹40,000 (₹50,000 for senior citizens) in a financial year.

What is the best RD tenure?

The best tenure depends on your financial goal. Short-term RDs (1-2 years) are good for upcoming expenses, while mid-term (3-5 years) can help build a solid savings corpus. Check bank rates, as 1-3 year tenures often offer the highest rates.