RD Calculator
See what your monthly recurring deposit will be worth at maturity
Year-by-year breakdown
| Year | Deposited (cumulative) | Interest (cumulative) | Value at year end |
|---|
What Is a Recurring Deposit (RD)?
A recurring deposit is a simple way to save a fixed amount every month and earn guaranteed interest on it. Think of it as a fixed deposit you build in monthly instalments: you choose an amount and a time period, deposit the same sum each month, and get your money back with interest at the end.
RDs are offered by banks and post offices across India. They're popular with people who want discipline without risk – first-time earners, families saving for a known expense like a wedding or a vehicle, and anyone who doesn't want their savings exposed to the stock market.
How to Use the RD Calculator
Step 1 – Enter your monthly deposit. Post Office RDs start at just ₹100 a month.
Step 2 – Enter the interest rate. It's pre-filled with the Post Office rate of 6.7%. For a bank RD, use the rate your bank offers for your chosen tenure.
Step 3 – Choose the time period. Bank RDs usually run from 6 months to 10 years; Post Office RDs run for 5 years (60 months).
The calculator shows your total deposit, the interest you'll earn and the maturity amount, along with how the same money might grow in an equity SIP for comparison.
How RD Interest Is Calculated
Banks and the Post Office compound RD interest every quarter. Because each monthly instalment is deposited at a different time, each one earns interest for a different period. Banks use this standard formula:
M = R × [(1 + i)n – 1] ÷ [1 – (1 + i)–1/3]
- M – Maturity amount
- R – Monthly instalment
- i – Annual interest rate ÷ 400 (the quarterly rate)
- n – Number of quarters (months ÷ 3)
Example: ₹5,000 a month in a Post Office RD at 6.7% for 5 years. You deposit ₹3,00,000 and get back ₹3,56,829 – ₹56,829 in interest. This matches India Post's official maturity table.
Post Office RD: What You Get
The Post Office RD pays 6.7% a year for October–December 2026, and the rate is locked in for the full 5 years once you open the account. Here's what different deposits grow to:
| Monthly Deposit | Total Deposited (5 years) | Interest Earned | Maturity Value |
|---|---|---|---|
| ₹1,000 | ₹60,000 | ₹11,366 | ₹71,366 |
| ₹2,000 | ₹1,20,000 | ₹22,732 | ₹1,42,732 |
| ₹5,000 | ₹3,00,000 | ₹56,829 | ₹3,56,829 |
| ₹10,000 | ₹6,00,000 | ₹1,13,658 | ₹7,13,658 |
Bank RD vs Post Office RD
| Bank RD | Post Office RD | |
|---|---|---|
| Interest rate | Varies by bank and tenure, often 6–7.5% | 6.7%, set by the government |
| Tenure | Usually 6 months to 10 years | Fixed at 5 years |
| Minimum deposit | Often ₹100–₹1,000 | ₹100 |
| Senior citizens | Usually 0.25–0.75% extra | Same rate for everyone |
| Safety | Deposits insured up to ₹5 lakh per bank (DICGC) | Backed by the Government of India |
| Early closure | Allowed with a small penalty | Allowed after 3 years |
A bank RD gives you flexibility on tenure; a Post Office RD gives you a government guarantee. For a 5-year goal, compare your bank's rate with the Post Office rate – and if you're a senior citizen, a bank RD may pay more.
How RD Interest Is Taxed
- RD interest is added to your income and taxed at your slab rate every year.
- Banks deduct TDS if your total interest from that bank crosses ₹50,000 in a year (₹1 lakh for senior citizens). If your income is below the taxable limit, you can submit Form 15G (or 15H if you're a senior citizen) to avoid TDS.
- Unlike a 5-year tax-saver FD, an RD doesn't give you a deduction under Section 80C.
So if you're in the 30% slab, a 7% RD effectively earns you less than 5% after tax.
RD vs SIP: Which Is Better?
Both let you invest a fixed amount every month, but they work very differently:
| ₹5,000 a month for 5 years | Post Office RD (6.7%) | Equity SIP (12%, illustrative) |
|---|---|---|
| Total invested | ₹3,00,000 | ₹3,00,000 |
| Value after 5 years | ₹3,56,829 (guaranteed) | About ₹4,12,432 (not guaranteed) |
| Risk | None | Can be lower than invested in bad years |
| Tax | Interest taxed at slab rate every year | 12.5% on gains above ₹1.25 lakh a year, only when you sell |
The simple rule: use an RD for money you'll need within 1–3 years or can't afford to lose, like a wedding fund or next year's school fees. For goals 5+ years away, an equity SIP has historically had more growth potential. Try our SIP Calculator and FD Calculator to compare.
Mistakes to Avoid
- Missing instalments. Banks and the Post Office charge a penalty for late instalments, and repeated misses can lead to the account being closed. Set up auto-debit.
- Using an RD for long-term goals. After tax and inflation, RD returns barely grow your money's real value over 10–20 years.
- Forgetting the tax. RD interest is taxable every year, even though you only receive it at maturity. Declare it in your tax return.
Questions People Actually Ask Us
Is RD interest fixed? Yes. The rate on the day you open the RD applies for the whole tenure, even if rates change later.
Can I withdraw my RD early? Banks allow early closure, usually with a small reduction in interest. A Post Office RD can be closed after 3 years, and you can take a loan of up to 50% of the balance after 12 instalments.
Is RD better than FD? If you have a lump sum, an FD usually earns more because all your money earns interest from day one. An RD suits you if you're saving from your monthly income.
Why is my bank's maturity amount slightly different? Banks may round interest each quarter or calculate based on exact deposit dates. The difference is usually a few rupees.
Disclaimer: This calculator is for educational purposes only. It uses the standard quarterly-compounding formula; your bank's figures may differ slightly. Interest rates change – check the current rate with your bank or India Post. RD interest is taxable. This calculator has no connection to any bank or India Post. See our full Disclaimer.
Also Try These Calculators on TappingMoney:
- FD Calculator – See what your fixed deposit will earn
- SIP Calculator – See how a monthly SIP grows
- PPF Calculator – Tax-free long-term savings
- Sukanya Samriddhi Calculator – Save for your daughter's future
Page last updated: September 2026 | Free to use | No sign-up needed