RD Calculator

A recurring deposit (RD) is a savings scheme that lets you deposit a fixed amount every month for a chosen term, earning a fixed rate of interest. It combines the discipline of regular saving with the safety and guaranteed returns of a fixed deposit, making it popular with people who want to build a lump sum gradually rather than locking away a large amount at once.

Each monthly deposit earns interest from the day it's paid until maturity, and interest is typically compounded quarterly. Because earlier deposits have longer to grow than later ones, the calculation effectively compounds each instalment separately and sums them up. For example, depositing ₹5,000 a month for 5 years (60 months) at 7% grows to roughly ₹3.59 lakh, of which ₹3 lakh is your deposits and about ₹59,000 is interest. The longer the tenure and the higher the rate, the larger the interest component.

The appeal of an RD is its combination of safety, predictability and discipline. The return is guaranteed and the principal is secure, just like an FD, but you don't need a large sum upfront — you commit a manageable monthly amount instead. This makes RDs well suited to saving for a specific near-term goal, such as a holiday, a gadget, or building an emergency cushion.

A few things to note. Like FD interest, RD interest is generally taxable as income, so your post-tax return is a little lower than the headline figure. Missing monthly instalments can attract small penalties, and withdrawing early usually reduces the interest you earn. RDs typically offer lower returns than market investments like mutual fund SIPs, but with none of the volatility — so they're best for goals where you can't afford to risk the principal. Use this calculator to see what your monthly saving will grow to and compare tenures before opening an RD.