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RD Calculator
Maturity value of a recurring deposit, with the quarterly compounding banks actually use.
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Result
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A recurring deposit is a fixed monthly contribution to a deposit account. Each instalment earns for a different length of time, so the maturity figure is not simply the rate applied to the total deposited.
How banks calculate it
Interest compounds quarterly, and each instalment earns from the day it is credited. The first instalment earns for the whole term; the last earns for a month. The calculator applies the quarterly convention rather than a flat approximation.
What it suits
Building a specific, near-term sum with no risk — school fees due next year, an insurance premium, a planned purchase. For anything beyond five years, the post-tax return rarely keeps up with inflation.
Missing instalments
A missed instalment attracts a small penalty, and six consecutive misses close most RD accounts. Set the date just after your salary credit.
Frequently asked questions
How is RD interest calculated?
Quarterly compounding, with each instalment earning from the date it is credited. The first instalment earns for the whole term and the last for a month, which is why maturity is not simply the rate applied to the total deposited.
What happens if I miss an instalment?
A small penalty applies, usually ₹1 to ₹2 per ₹100 per month. Six consecutive missed instalments close most RD accounts, with the balance paid out as a savings deposit.
Is RD interest taxable?
Yes, at your slab rate, in the year it accrues. TDS applies on the same thresholds as a fixed deposit.
RD or SIP?
An RD for a fixed sum needed within a few years, where certainty matters more than return. A SIP for anything beyond five years, where inflation is the bigger risk than volatility.