Recurring Deposit (RD) Calculator
Calculate precise fractional-quarter compounding RD maturity value and understand your exact pre-tax yields.
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The 2026 Master Guide to Recurring Deposits (RD)
Just like a Fixed Deposit, your Recurring Deposit is backed by the Deposit Insurance and Credit Guarantee Corporation (DICGC). However, the ₹5,00,000 maximum limit applies cumulatively across all your deposits (Savings, FD, and RD) in that specific bank. If your total exposure to one bank exceeds ₹5 Lakhs, your capital is technically at risk.
1. What is a Recurring Deposit (RD)?
A Recurring Deposit is a term deposit that allows retail investors to make regular monthly investments rather than a single lump sum, while securing a fixed interest rate. When you open an RD, the bank locks in the prevailing interest rate for your entire chosen tenure.
Unlike an FD where the entire principal compounds from Day 1, an RD compounds each monthly installment differently. The first deposit compounds for the full tenure; the last deposit compounds for just one month.
2. The Brutal Truth About RD Taxation
The interest you earn on an RD is not tax-free. It is classified as "Income from Other Sources" and is taxed entirely at your marginal income tax slab rate.
- The TDS Trap: If your total interest income from a bank (FD + RD combined) exceeds ₹40,000 per financial year (₹50,000 for Senior Citizens), the bank will automatically deduct 10% TDS.
- The 30% Slab Reality: If you are in the 30% tax bracket, a 7.00% RD actually only yields a net post-tax return of roughly 4.9%, which generally fails to beat real inflation.
Master the RD Compounding Engine
Stop guessing your wealth. From the quarterly-rest mathematics to the brutal 30% tax drag, discover how Recurring Deposits truly work in the 2026 Master Guide.
Read the RD Master Guide →Frequently Asked Questions
What happens if I miss an RD monthly payment?
Banks impose a strict penalty for delayed installments, typically calculated at ₹1.50 per ₹100 per month. If you miss consecutive payments (usually 5 or 6), the bank reserves the right to forcefully close your RD account and refund the balance, destroying your compounding.
Can I break an RD before maturity?
Yes, premature withdrawal is permitted. However, the bank will calculate interest at the rate applicable for the exact period the deposit ran, and then apply an additional 0.5% to 1.0% penalty.
Does an RD compound monthly or quarterly?
In India, the standard banking practice is to compound Recurring Deposits quarterly. Even though you deposit money every month, the bank aggregates those deposits and calculates the "interest on interest" at the end of every quarter.
Actuarial & System Assumptions
This simulation engine is provided for illustrative, educational, and strategic planning purposes only. It does not constitute a financial contract, legal guarantee, or fiduciary advice.
Calculations rely on deterministic inputs and compounded mathematical growth models. Real-world inflation, sequence of returns, market volatility, and asset degradation will cause actual results to deviate.
Tax brackets, government subsidies (e.g., PM Surya Ghar), and statutory interest rates are subject to continuous legislative amendments. This engine does not guarantee real-time legal compliance.
Rupee Logics is a mathematical simulator, not a SEBI-registered entity. Users are strictly advised to verify all capital allocations and liability assumptions with certified financial professionals.