RD Calculator
Calculate returns on Recurring Deposit (RD) investments in India. RD allows you to save a fixed amount monthly and earn interest compounded quarterly, making it ideal for building savings discipline.
Interest Rate
Investment Summary
Total Deposits:
?0
Maturity Value:
?0
Total Interest:
?0
Interest Breakdown
Interest Earned:
?0
Effective Yield:
0.00%
Annual Interest:
?0
Investment Analysis
Monthly Deposit:
?0
Investment Period:
0 months
Wealth Created:
?0
Understanding Recurring Deposits (RD)
A Recurring Deposit (RD) is a savings scheme offered by banks and post offices in India. It allows you to deposit a fixed amount every month for a specified period and earn interest on the accumulated balance, making it an excellent tool for building savings discipline.
RD Key Features
Investment Details
- Minimum monthly deposit: ?100
- Maximum deposit: Varies by bank
- Tenure: 6 months to 10 years
- Monthly deposit frequency
- Auto-debit from savings account
Interest & Returns
- Quarterly compounded interest
- Senior citizen rates higher
- Taxable as per income slab
- Premature withdrawal allowed
- Loan facility available
Current RD Interest Rates (2024)
| Bank | General Public | Senior Citizens | Minimum Deposit |
|---|---|---|---|
| SBI | 6.50% | 7.00% | ?100 |
| HDFC Bank | 6.25% | 6.75% | ?100 |
| ICICI Bank | 6.30% | 6.80% | ?100 |
| Axis Bank | 6.40% | 6.90% | ?100 |
| Post Office RD | 6.50% | 6.50% | ?100 |
How RD Interest is Calculated
Quarterly Compounding Formula
Interest calculated on quarterly balance
Calculation Method:
- Monthly deposits accumulate
- Interest calculated quarterly
- Based on minimum quarterly balance
- Compounded quarterly
- Paid at maturity
Example Calculation:
- Monthly deposit: ?5,000
- Period: 24 months
- Rate: 6.5% per annum
- Quarterly rate: 1.625%
- Interest accrues on quarterly balance
RD vs Other Investment Options
RD Advantages:
- Forces savings discipline
- Higher interest than savings accounts
- Flexible tenure options
- Loan against RD available
- Easy to start and manage
RD Limitations:
- Lower returns than mutual funds
- Penalty on premature withdrawal
- Interest rate risk
- Quarterly compounding
- Taxable interest income
RD Taxation
Interest Taxation:
- Taxed as per income tax slab
- TDS applicable if interest > ?40,000
- Form 15G/15H for no TDS
- Added to annual taxable income
Tax Planning:
- Consider in overall tax planning
- Balance with tax-saving investments
- Utilize deductions under 80C
- Plan for TDS requirements
RD Premature Withdrawal
| Completion Period | Interest Rate | Penalty |
|---|---|---|
| Before 3 months | Savings account rate | No interest |
| 3-6 months | 50% of contracted rate | Reduced interest |
| After 6 months | 70% of contracted rate | Minimal penalty |
RD Loan Facility
Loan Against RD:
- Available after 3 months
- Up to 80-90% of deposit value
- Higher interest rate than RD
- Flexible repayment options
- No impact on RD interest
Benefits:
- Emergency fund access
- Lower interest than personal loans
- Quick processing
- Minimal documentation
- RD continues earning interest
Who Should Invest in RD?
Ideal Investors:
- Conservative investors
- Those seeking guaranteed returns
- People wanting savings discipline
- Short-term savers (1-5 years)
- Risk-averse individuals
Not Suitable For:
- Growth-oriented investors
- Those seeking high returns
- Investors needing liquidity
- Long-term wealth creators
- Tax-saving focused investors
Key Takeaways for RD Investment
- RD helps build savings discipline with regular monthly deposits
- Interest compounded quarterly on the accumulated balance
- Suitable for conservative investors seeking guaranteed returns
- Minimum deposit ?100, tenure from 6 months to 10 years
- Interest rates vary by bank, senior citizens get higher rates
- Premature withdrawal allowed with penalty
- Loan facility available against RD balance
- Consider as part of diversified savings portfolio