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RD Maturity Results
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About This Calculator
- What it calculates
- Recurring deposit maturity amount, total interest earned, and effective annual yield using quarterly compounding — the standard method used by Indian banks.
- Inputs required
- Monthly deposit amount (₹500–₹1,00,000), annual interest rate (1%–20%), tenure in months (3–120).
- Outputs
- Maturity amount, total deposited, total interest earned, effective annual yield, and an invested-vs-interest bar chart.
- Formula
- Each monthly installment is compounded quarterly for its remaining tenure: A = R × (1 + r/400)^((n−m)/3), summed over all months m=1 to n.
- Assumptions
- Constant monthly installment and fixed interest rate throughout tenure. No premature withdrawal penalty modelled.
- Last updated
What is a Recurring Deposit?
A Recurring Deposit (RD) is one of the most popular savings instruments in India. Unlike a Fixed Deposit that requires a lump sum, an RD allows you to invest a fixed amount every month and earn a guaranteed, predetermined interest rate. At the end of the tenure, you receive the total accumulated amount — principal plus interest.
RDs are offered by all public and private sector banks, small finance banks, and the post office (Post Office RD). They are ideal for salaried individuals, students, and homemakers who want to build a habit of disciplined saving without needing a large initial corpus. The investment is safe, the returns are fixed, and you know exactly what you will receive at maturity before you start.
Indian banks calculate RD interest using quarterly compounding, which means interest is compounded four times a year. This results in slightly higher effective returns compared to simple interest. The post office uses the same quarterly compounding method, making it comparable across institutions.
RD tenures typically range from 6 months to 10 years. The minimum monthly deposit at most banks starts from ₹500 to ₹1,000, while the post office allows as little as ₹100 per month. There is no upper limit on monthly deposits, making RDs suitable for both small savers and those parking large amounts on a regular basis.
How to Use This RD Calculator
- Enter your monthly deposit: This is the fixed amount you will deposit every month throughout the tenure. Use the slider for quick adjustments between ₹500 and ₹1,00,000.
- Set the interest rate: Enter the annual interest rate offered by your bank. Check your bank's website for current RD rates, or use 7% as a general benchmark. Senior citizens typically get 0.25%–0.5% extra.
- Set the tenure in months: Common tenures are 12, 24, 36, 48, or 60 months. The slider lets you fine-tune between 3 and 120 months (10 years).
- Click Calculate RD Maturity: You'll instantly see the maturity amount, total deposited, interest earned, and effective annual yield. The bar chart visually shows how much of your maturity is principal and how much is interest.
Pro tip: Compare multiple banks by changing the interest rate while keeping the deposit and tenure constant. Even a 0.5% difference in rate can translate to thousands of rupees difference in interest earned over a 3–5 year RD.
RD Calculation Formula
Indian banks use quarterly compounding for RDs. The formula accounts for the fact that each monthly installment earns interest for a different period — the first installment earns the longest, and the last earns zero additional interest.
Where:
- M = Maturity amount
- R = Monthly installment (₹)
- r = Annual interest rate (%)
- n = Total tenure in months
- m = Month number of each installment (1 to n)
This means the 1st installment (m=1) compounds for (n−1) months, the 2nd (m=2) for (n−2) months, and so on. The last installment (m=n) earns no additional interest. The quarterly compounding rate per period is r/400, and the number of quarters for each installment is (n−m)/3.
A simplified closed-form version commonly cited in banking literature:
Where t = n/12 (tenure in years). Both formulas yield the same result and this calculator uses the exact summation method for maximum accuracy.
The effective annual yield is calculated as: EAY = (1 + r/400)^4 − 1, which accounts for the quarterly compounding effect and will always be slightly higher than the nominal annual rate.
Example Calculations
Example 1: ₹5,000/month for 24 months at 7% p.a.
Monthly Deposit = ₹5,000 | Rate = 7% | Tenure = 24 months
Total Deposited = ₹5,000 × 24 = ₹1,20,000
Maturity Amount ≈ ₹1,28,695
Total Interest Earned ≈ ₹8,695
This is a typical 2-year RD suitable for saving towards a short-term goal like a vacation or emergency fund top-up.
Example 2: ₹10,000/month for 60 months at 7.5% p.a.
Monthly Deposit = ₹10,000 | Rate = 7.5% | Tenure = 60 months (5 years)
Total Deposited = ₹10,000 × 60 = ₹6,00,000
Maturity Amount ≈ ₹7,25,400
Total Interest Earned ≈ ₹1,25,400
A 5-year RD at 7.5% grows your savings by over 20%. Ideal for building a home down-payment fund or children's education corpus.
Example 3: ₹2,000/month for 12 months at 6.5% p.a. (Post Office)
Monthly Deposit = ₹2,000 | Rate = 6.7% | Tenure = 12 months
Total Deposited = ₹2,000 × 12 = ₹24,000
Maturity Amount ≈ ₹24,883
Total Interest Earned ≈ ₹883
A 1-year post office RD for a small but safe short-term savings goal. Better than a savings account and sovereign-guaranteed.
RD vs FD vs SIP — Which Should You Choose?
Each instrument serves a different need. Here's a practical comparison:
- RD (Recurring Deposit): Best for regular savers who want to invest monthly from their salary. Returns are guaranteed (6–8% p.a.), interest is taxable, no lock-in beyond initial commitment. Ideal for short to medium-term goals of 1–5 years. Works like a forced savings plan.
- Fixed Deposit (FD): Best when you have a lump sum to invest. FD rates are slightly higher than RD rates (same bank, same tenure). Flexible tenure from 7 days to 10 years. Interest is taxable. If you invest ₹1 lakh at once in an FD at 7.5%, you earn more than a ₹10,000/month RD at 7.5% for 10 months — because the FD principal earns interest from day 1.
- SIP in Mutual Funds: Similar structure to RD (monthly investment), but with market-linked returns. Historical equity SIP returns have been 12–15% p.a. over 10+ years, significantly higher than RD. However, returns are not guaranteed and capital can temporarily fall below invested amount. Best for long-term goals (5+ years) where market volatility is acceptable.
Recommended strategy: Use an RD for goals within 1–3 years where capital safety is paramount (vacation fund, emergency fund, car down-payment). Use SIPs for goals beyond 5 years (retirement, wealth creation). Combine both: maintain 3–6 months of expenses in an RD as liquid savings, and invest surplus in SIPs for long-term growth.
Bank RD Interest Rates 2026
The following rates are indicative for general customers (senior citizens typically get 0.25%–0.5% extra). Always verify current rates directly with your bank.
- State Bank of India (SBI): 6.50%–7.00% p.a. depending on tenure
- HDFC Bank: 6.50%–7.25% p.a. depending on tenure
- ICICI Bank: 6.70%–7.25% p.a. depending on tenure
- Axis Bank: 6.75%–7.26% p.a. depending on tenure
- Kotak Mahindra Bank: 6.40%–7.40% p.a. depending on tenure
- Post Office RD: 6.70% p.a. (sovereign-guaranteed, uniform across all post offices)
- Small Finance Banks (e.g., AU, Jana): 7.50%–8.50% p.a. — higher rates, DICGC insured up to ₹5 lakh
Note: RD rates change periodically based on RBI repo rate movements. Use this calculator to compare the maturity amount at different rates to find the best offer for your tenure.
Frequently Asked Questions
Calculator Category
This tool belongs to Finance Calculators. Browse similar tools for related calculations.
Results are for informational purposes only. RD interest rates vary by bank and are subject to change. Actual maturity amounts may differ due to TDS deductions, premature closure penalties, or rate revisions. Consult your bank for official figures.