recurring-deposit-calculator

Tenure	6% p.a.	6.5% p.a.	7% p.a.	7.5% p.a.
6 months	Rs.30,453	Rs.30,492	Rs.30,531	Rs.30,570
12 months	Rs.61,837	Rs.62,000	Rs.62,163	Rs.62,326
24 months	Rs.1,27,483	Rs.1,28,328	Rs.1,29,182	Rs.1,30,044
36 months	Rs.1,96,886	Rs.1,98,680	Rs.2,00,488	Rs.2,02,310
60 months	Rs.3,48,846	Rs.3,52,841	Rs.3,56,880	Rs.3,60,962
Total interest (12mo)	Rs.1,837	Rs.2,000	Rs.2,163	Rs.2,326

Feature	LazyTools	BankBazaar RD	ET Money RD	Groww RD
Quarterly compounding	✓ Yes	✓	✓	✓
TDS check	✓ Yes	✗	✗	✗
Bank vs PO rates	Yes (FAQs)	✓	✗	✗
Loan against RD	Yes (FAQs)	✗	✗	✗
No registration	✓ Yes	✗	✓	✓
Free	✓ Yes	✓	✓	✓

📖 Complete guide

Recurring Deposit Calculator: Complete Guide

Recurring Deposit is one of India's most popular savings instruments - it combines the safety of a bank deposit with the discipline of regular monthly saving. The fixed monthly commitment and guaranteed interest rate make RD ideal for short-to-medium term financial goals.

RD vs SIP: choosing the right vehicle

For a 5-year goal: RD at 7% on Rs.5,000/month generates Rs.3,58,000 maturity with complete capital safety. SIP at 12% on Rs.5,000/month generates approximately Rs.4,08,000 but with market risk. If you cannot afford a 30-40% drawdown, use RD. If you have 5+ years and can tolerate volatility, SIP wins on expected returns.

Tax-efficient RD strategy

RD interest is taxed annually as it accrues. Strategies to minimise tax: (1) Split large RD across family members to stay below Rs.40,000/year TDS threshold each. (2) Open RD in a non-working spouse's name if their income is in lower tax bracket. (3) For tax-free equivalent, compare RD post-tax yield vs PPF 7.1% (completely tax-free) - PPF wins for 30% taxpayers.

Building an emergency fund with RD

A popular strategy: open RD for 12 months with monthly amount = 1 month expenses. By the end of year, you have a 12-month RD chain where one RD matures every month. This gives you liquidity (one RD matures monthly) combined with RD interest rather than keeping the entire amount in a low-interest savings account. Premature closure of any RD for emergencies is possible with small penalty.

Frequently asked questions

What is the current Post Office RD interest rate?

The Post Office RD (5-year) interest rate for Q4 FY2025-26 (latest confirmed) is 6.7% p.a. (current as of May 2026). Post Office RD has a fixed 5-year tenure. Bank RD rates vary: major banks offer 6.5-7.5% for various tenures, with senior citizens typically getting 0.25-0.5% higher rates. Always compare rates at the time of investment.

How is RD interest compounded?

RD interest is compounded quarterly for most banks and post offices. The formula: maturity = Sum of [D x (1+r/4)^(4n/12)], where D = monthly deposit, r = annual rate, n = remaining months. Quarterly compounding means the effective annual yield is slightly higher than the nominal rate.

Is RD interest taxable?

Yes - RD interest is fully taxable as income from other sources at the applicable income tax slab rate. TDS at 10% applies if total interest from a bank exceeds Rs.40,000 per year (Rs.50,000 for senior citizens). Interest accrues annually and must be reported in income tax return each year, even if not received.

Can I break my RD before maturity?

Yes - premature RD closure is allowed at most banks and post offices. Banks typically charge a penalty of 0.5-1% on the applicable rate for the period held. Post Office RD allows premature closure after 3 years at post office savings account rate (currently 4%). Withdrawing before 3 years from Post Office RD is not permitted.

How does RD compare to SIP mutual funds?

RD: guaranteed returns (6.5-7.5%), no market risk, fixed maturity amount, taxable interest. SIP: variable returns (historical 10-15% for equity), market risk, no guarantee, LTCG taxed at 12.5% above Rs.1.25 lakh after 12 months. RD is better for short-term goals (under 3 years) or for risk-averse investors; SIP is better for long-term (5+ years) wealth creation.

What is the minimum RD amount?

Most banks allow RD from Rs.100/month. Post Office RD minimum is Rs.100/month (in multiples of Rs.10). There is no maximum limit for bank RDs. The beauty of RD is its accessibility - even Rs.500/month is sufficient to start building savings discipline.

Can I take a loan against my RD?

Yes - most banks offer loans against RD up to 90-95% of the RD amount. The loan interest rate is typically 1-2% above the RD rate. This feature makes RD useful as an emergency fund - you earn RD interest while having access to funds through a loan. Post Office RD allows a loan of up to 50% of deposits after 1 year.

What is the post office RD vs bank RD difference?

Post Office RD: fixed 5-year tenure, government-backed, 6.7% (Q1 2024-25), no TDS if annual interest below Rs.40,000, limited flexibility. Bank RD: flexible tenure (3 months to 10 years), rates vary by bank and tenure, senior citizen higher rates, premature withdrawal with small penalty. Most banks offer better rates than post office RD for 2-3 year tenures.

How to use this calculator for tax planning

Financial calculations are most valuable when used proactively - before making decisions, not after. Use this calculator to model different scenarios: what happens if you increase the investment amount by 20%? What if the tenure changes by 5 years? What if the interest rate moves by 1%? Scenario modelling with a calculator is free and takes minutes, but the decisions it informs can save or earn lakhs of rupees over a lifetime. Revisit your calculations annually as rates, tax rules, and personal circumstances change - the financial landscape in India evolves significantly year to year.

Regulatory and rate changes in effect for 2025-26

The current financial year 2025-26 (April 2025 to March 2026) applies the following key rates and rules. In India: LTCG on equity funds is 12.5% above Rs.1.25 lakh (Finance Act 2024, in force since 23 July 2024). STCG on equity is 20%. Small savings scheme rates stable: PPF 7.1%, SSY 8.2%, POMIS 7.4%. In the UK (2026/27 tax year): Employee NI 8%, employer NI 15% above £5,000. CGT 18%/24% on all assets. BADR 18% from 6 April 2026. Always verify current rates with official sources (income tax India: incometax.gov.in; HMRC UK: gov.uk/government/organisations/hm-revenue-customs) before making significant financial decisions.

Common mistakes in personal finance calculations

The most common errors in personal financial planning: (1) Using pre-tax return rates when the investment is taxable - always compare on a post-tax basis. (2) Ignoring inflation when planning long-term goals - Rs.10 lakh needed in 20 years requires Rs.32 lakh at 6% inflation. (3) Not accounting for charges: expense ratio on mutual funds, processing fee on loans, and withdrawal penalties on fixed income instruments all reduce actual returns. (4) Planning for best-case returns rather than conservative estimates - model at 10% return, not 15%, for long-term equity SIP projections. (5) Treating past performance as future guarantee - historical equity fund returns have been volatile decade to decade.

Privacy and data security

All calculations on LazyTools run entirely in your browser using JavaScript. No input data - salary, investment amounts, loan details, or personal information - is transmitted to any server, stored in any database, or shared with any third party. The calculator works offline once the page has loaded (except Google Fonts). LazyTools is monetised through Google AdSense display advertising, which uses advertising cookies independent of calculator functionality. If you prefer completely ad-free use, your browser's reading mode or a content blocker will hide the ad units without affecting the calculator.

Linking this calculator to your broader financial plan

No single financial calculator exists in isolation. Take-home pay calculations feed into EMI affordability checks. Loan EMI calculations feed into investment capacity planning. Investment corpus calculations feed into retirement income planning. Use the related tools linked below to build a complete picture of your financial position. A comprehensive financial plan typically covers: income and tax optimisation (salary structure, HRA, 80C investments); debt management (home loan, car loan, personal loan); medium-term savings (SIP, ELSS, PPF, RD); and long-term retirement planning (EPF, NPS, SSY for daughter). Each LazyTools calculator addresses one piece of this puzzle.

Getting the most from this calculator

For the best results, revisit this calculator whenever your financial situation changes: salary increment, change in loan, new investment, or a change in tax rules. Financial calculations are dynamic - a 1% change in interest rate or return can significantly alter outcomes over 10-20 year horizons. LazyTools calculators are updated to reflect current rates and tax rules. Bookmark this page and return annually to recalibrate your financial plan. If you are making a significant financial decision - taking a large loan, making a major investment, or restructuring your salary - consider consulting a certified financial planner (CFP) or chartered accountant (CA) alongside using this calculator. Free calculators provide accurate mathematical output but cannot replace personalised professional advice that accounts for your specific circumstances, goals, risk tolerance, and legal situation.

Frequently missed optimisations in personal finance

Most people focus on the obvious aspects of financial planning - saving more, investing more - and miss structural optimisations that can deliver equivalent results with no extra money. For salaried employees: salary restructuring (maximising HRA, food coupons, transport allowance, LTA) can reduce taxable income by Rs.60,000-1,20,000 per year without spending more. For borrowers: matching loan prepayment with annual bonus cycles (rather than keeping bonus in savings) can save more in interest than the savings account earns. For investors: booking Rs.1.25 lakh of equity gains annually (the LTCG exemption under Finance Act 2024) and immediately reinvesting effectively eliminates LTCG tax on growing portfolios. For retirees: sequencing withdrawals from taxable accounts first (FD, RD) and preserving tax-free accounts (PPF, EPFO) as long as possible minimises lifetime tax. These structural moves require no additional cash flow - just informed decision-making, which is exactly what these calculators are designed to support.

Sources and authoritative references

This calculator uses rates and rules from the following official sources. Verify current rates before making financial decisions, as these can change:

LazyTools calculators are updated to reflect legislative changes. Last verified: May 2026. This tool provides mathematical calculations only and does not constitute financial or tax advice. Consult a qualified accountant or financial adviser for decisions affecting your specific circumstances.

RD Calculator India — Recurring Deposit 2024

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