Recurring Deposit Calculator

Calculate the exact maturity value, total interest earned, and effective annual yield on your Recurring Deposit (RD) with our professional-grade financial tool. Plan your disciplined savings strategy for 2026 with real-time results.

Calculate Your RD

₹
₹5,000
%
6.5%

Standard tenures: 6M to 10Y

Your RD Results

Total Amount Invested
₹60,000
Total Interest Earned
₹5,412
Maturity Value
₹65,412
Effective Annual Yield
6.71%

Results update in real-time as you adjust inputs. Figures are indicative. Actual bank rates may vary.

Understanding Recurring Deposits

A Recurring Deposit (RD) is a systematic savings instrument offered by banks, post offices, and financial institutions. It allows you to invest a fixed amount every month for a predetermined tenure, earning compound interest at a fixed rate. Unlike lump-sum investments, RDs cultivate financial discipline and are ideal for salaried individuals, students, and anyone aiming to build a corpus through regular savings.

Real-World Use Cases for RD (2026)

Case 1: Building an Emergency Fund

Scenario: Priya, a 28-year-old software engineer, wants to build a ₹3 lakh emergency fund over 4 years. She opts for a bank RD with a monthly deposit of ₹6,000 at 7% p.a.
Calculation: Using our calculator, her maturity value after 48 months would be approximately ₹3,22,560, earning ₹34,560 in interest. This provides a risk-free, accessible corpus for unforeseen expenses.

Case 2: Saving for a Child's Education

Scenario: The Sharma family starts a 10-year RD when their child is 8, saving ₹10,000 monthly at 6.8% p.a. for future college fees.
Calculation: At maturity, they will have invested ₹12 lakhs. With compound interest, the maturity amount will be approximately ₹17,24,000, generating over ₹5 lakhs in interest, helping counter education inflation.

Case 3: Planning for a Wedding or Down Payment

Scenario: Rohan plans to marry in 3 years. He starts an RD with ₹15,000/month at 6.5% p.a.
Calculation: Total investment: ₹5,40,000. Estimated maturity: ₹5,97,800. The guaranteed returns of an RD make it superior to volatile market options for such short-term, crucial goals.

The RD Formula Explained

The maturity value of an RD is calculated using the future value of a series formula, as interest is compounded quarterly in most banks. Here's the breakdown:

Maturity Value (M) = R × [ {(1 + i)ⁿ – 1} / (1 – (1 + i)^(-1/3)) ]

Where:
• R = Monthly installment amount
• i = Quarterly interest rate = (Annual Rate / 4) / 100
• n = Number of quarters = (Tenure in months / 3)
• 1/3 in the denominator accounts for the monthly deposit adjustment for quarterly compounding.

Example Calculation: For ₹5,000/month, 6.5% p.a., 1-year tenure:
Quarterly rate (i) = (6.5/4)/100 = 0.01625. Quarters (n) = 12/3 = 4.
M = 5000 × [ {(1.01625)^4 - 1} / (1 - (1.01625)^(-1/3)) ] ≈ ₹62,412 (Total Interest: ₹2,412).

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Frequently Asked Questions (FAQs)

Get expert answers to common queries about Recurring Deposits for 2026 financial planning.

What is the formula to calculate RD maturity amount?
The maturity value is calculated using the formula for the future value of a series with quarterly compounding: M = R × [ {(1 + i)ⁿ – 1} / (1 – (1 + i)^(-1/3)) ]. Where R=Monthly Deposit, i=Quarterly Interest Rate, n=Number of Quarters. Our calculator above automates this complex calculation for you.
Is RD interest taxable in 2026?
Yes. Interest earned from RDs is fully taxable under 'Income from Other Sources' per the Income Tax Act. Banks deduct TDS at 10% if the annual interest exceeds ₹40,000 (₹50,000 for senior citizens). It's crucial to account for this in your post-tax return calculations. For tax-efficient alternatives, consider our Tax Planning Calculator.
Can I break my RD before maturity? What are the charges?
Most banks allow premature withdrawal, but a penalty (usually 0.5%-2%) is levied on the contracted interest rate. The bank will pay interest at the rate applicable for the period the deposit was held or the contracted rate minus penalty, whichever is lower. It's best to use the tenure slider in our calculator to see how duration affects returns before committing.
What is the difference between an RD and a Fixed Deposit (FD)?
An FD is a lump-sum investment, while an RD involves regular monthly deposits. RDs are perfect for building a savings habit with a fixed monthly commitment. FDs might offer slightly higher rates for large lump sums. Use our FD Calculator to compare returns directly.
Which is better for saving: an RD or a Debt Mutual Fund?
RDs offer capital protection and guaranteed returns, making them ideal for risk-averse savers with short-term goals (1-5 years). Debt Funds may offer higher potential post-tax returns for longer horizons (3+ years) but carry interest rate and credit risk. Your choice depends on risk tolerance, time horizon, and tax bracket. For goal-based analysis, try our Savings Goal Calculator.