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Recurring Deposit Calculator

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About This Tool

Recurring Deposit Calculator – RD Maturity, Goals and TDS the Way Banks Compute Them

A recurring deposit (RD) lets you save a fixed amount every month at an interest rate that is locked in on the day you open it. It is the classic way to turn a monthly surplus into a guaranteed lump sum for a vacation, a school fee or a down payment. This RD calculator follows the conventions Indian banks and India Post actually use, so you can see your RD maturity amount, the installment you need for a target, the tax deducted along the way and the cost of closing the account early.

How RD interest is calculated

You pay one installment at the start of each month, and the RD matures one month after the last installment. Interest is compounded quarterly, but because installments arrive monthly, each one compounds for a fractional number of quarters. Installment k of N stays invested for m = N − k + 1 months and grows to:

R × (1 + r/4)^(m / 3)

Adding every installment gives the maturity value. For quarterly compounding this sums to M = R × [(1 + i)^(N/3) − 1] / [1 − (1 + i)^(−1/3)], where i = r/4. At 7%, ₹5,000 a month for 12 months matures to ₹62,310.66, and for 60 months to ₹3,59,663.95. The calculator builds the same result as a month-by-month ledger, which powers the schedule, the charts and the financial-year split.

Why the return looks lower than the rate

The most common surprise with an RD is the interest figure. Saving ₹5,000 a month for five years at 7% earns about ₹59,664, which is 19.89% of what you deposited, not 35%. Nothing is wrong: your first installment earns interest for 60 months, but your last earns it for only one. On average each rupee is invested for (N + 1) / 2 months, just over half the tenure. The annualised yield is still the full 7.19% effective rate, and the "What each installment earns" chart shows exactly where the interest comes from.

Planning for a goal

Because maturity grows in direct proportion to the installment, the Goal tab can work backwards: divide your target by the maturity of a ₹1 RD. To reach ₹5,00,000 in 36 months at 7% you need ₹12,457.24 a month; setting up ₹12,460 gets you ₹5,00,110.73. The tenure chart shows how stretching the timeline lowers the installment, with diminishing savings each extra year.

Tax and TDS on recurring deposits

RD interest is taxable at your slab rate in the year it accrues, even though you receive it only at maturity. Banks deduct TDS of 10% (20% without PAN) in any financial year where your total interest at that bank crosses the threshold, which is ₹50,000 for most depositors and ₹1,00,000 for senior citizens. The calculator spreads interest across financial years (1 April – 31 March) and flags the years that cross the line. Choose your tax slab to see post-tax interest and a post-tax annualised yield.

The threshold counts all your deposits at the bank
The TDS threshold applies to the combined interest from every FD and RD you hold at the same bank. If you have other deposits there, TDS may start earlier than this estimate shows.

Premature closure

Closing an RD early usually means the bank pays interest at the rate for the period you actually held it, or the contract rate if lower, minus a penalty that is often 0.5%. The Premature tab shows what you would receive, how much interest the penalty costs and what you give up by not continuing.

Post Office RD

The India Post RD runs for a fixed five years, accepts installments from ₹100 in multiples of ₹10, and has its rate set by the Government every quarter. It can be closed only after three years, at the post office savings rate. Choose Post Office RD to apply these rules automatically.

Check the current rates
Bank RD rates, the India Post rate and tax thresholds change from time to time. Enter the rate from your bank's current rate card and treat tax figures as estimates.

Frequently Asked Questions

Is the Recurring Deposit Calculator free?

Yes, Recurring Deposit Calculator is totally free :)

Can I use the Recurring Deposit Calculator offline?

Yes, you can install the webapp as PWA.

Is it safe to use Recurring Deposit Calculator?

Yes, any data related to Recurring Deposit Calculator only stored in your browser (if storage required). You can simply clear browser cache to clear all the stored data. We do not store any data on server.

How does this RD calculator work?

It follows the convention Indian banks and India Post use: one installment at the start of each month, interest compounded quarterly, and maturity one month after the last installment. Each installment grows for the months it stays in the account, and the calculator adds them all up month by month.

Why is my RD interest so much lower than rate × years?

Only your first installment is invested for the whole tenure; the last one earns interest for a single month. On average each rupee is invested for about half the tenure, so ₹5,000 a month at 7% for 5 years earns about 19.9% in total, not 35%, even though the annualised yield is still 7.19%.

Is RD interest taxable, and when is TDS deducted?

Yes. RD interest is taxed at your slab rate in the year it accrues, even though you receive it only at maturity. Banks deduct 10% TDS (20% without PAN) in any financial year where your total interest at that bank crosses the threshold, unless you have submitted Form 15G or 15H.

What happens if I miss an RD installment?

Banks and India Post charge a small monthly late fee on the overdue installment, usually a fixed amount per ₹100 of installment, and the exact fee varies by institution. Missing several installments in a row can lead to the account being discontinued, so check your bank's rules.

Can I close an RD early, and what is the penalty?

Most banks allow premature closure. They pay interest at the rate applicable to the period you actually held the RD, minus a penalty that is often 0.5–1%. A Post Office RD can be closed only after 3 years and then earns the post office savings account rate instead of the RD rate.

RD vs FD vs SIP: which suits which goal?

An RD suits you if you save from your monthly income and want a guaranteed amount on a fixed date. An FD suits a lump sum you already have. A mutual-fund SIP can earn more over long periods but its returns are not guaranteed, so it is better for goals several years away that can ride out market swings.