Recurring Deposit (RD) Maturity Calculator
Evaluates maturity proceeds and accumulated interest from monthly recurring deposits compounded quarterly according to Indian banking norms.
How This Calculation Formula is Formulated
A Recurring Deposit (RD) compounds monthly deposits on a quarterly basis according to the Indian Post Office and Reserve Bank of India formula. Each monthly installment earns interest for the remainder of the tenure, compounding at the end of each quarter.
Variable Definitions & Measurement Units
Monthly Recurring Deposit of ₹5,000 for 3 Years at 7.0% p.a.
RD vs. SIP: Guaranteed Return vs. Market Risk
A Recurring Deposit provides 100% sovereign or bank-insured capital protection with fixed guaranteed interest, making it ideal for short-term goals (1 to 3 years) such as vacation savings or emergency funds.
In contrast, an equity mutual fund SIP fluctuates with market volatility but historically delivers higher long-term real returns (11–14% CAGR) for horizons exceeding 5 to 7 years.
Frequently Asked Questions About Recurring Deposit (RD) Maturity Calculator
How does RD quarterly compounding work with monthly deposits?
Deposits made during a quarter earn proportional fractional-quarter simple interest, which is converted to compound principal at the end of every 3-month quarter.
Is interest earned on Recurring Deposits taxable?
Yes. RD interest is fully taxable under 'Income from Other Sources' at your marginal income tax slab rate, with TDS applicable if interest exceeds ₹40,000 in a financial year.
What happens if I miss an RD installment?
Banks typically charge a small penalty (e.g., ₹1.50 to ₹2.00 per ₹100 of installment) for delayed payments. Consecutive defaults may result in premature closure.
Can I take a loan against my RD account?
Yes. Most banks permit loans or overdraft facilities up to 80% to 90% of the accumulated RD balance at an interest rate 1% to 2% above the RD rate.
Related Online Calculators
Frequently referenced alongside Recurring Deposit (RD) Maturity Calculator.
Fixed Deposit (FD) Maturity Calculator
Calculates bank fixed deposit maturity proceeds, interest earnings, and post-TDS yield using standard quarterly compounding.
SIP Calculator
A forward-projecting annuity due model calculating compound wealth accumulation via dollar-cost averaging.
Compound Interest Calculator
An exponential balance projection engine computing compound interest growth across multi-frequency reinvestment intervals.