Find the final amount of a monthly Recurring Deposit.
Each month's deposit earns interest for a different length of time — the first deposit compounds the longest, the last barely at all.
Maturity: Sum of each month's deposit, compounded for its own remaining time
A recurring deposit lets you save a fixed amount every month and earn a fixed interest rate, much like an FD built up one instalment at a time. This calculator adds up what all those monthly deposits grow to by the maturity date, so you can see the final sum before you open the account.
RDs are popular with salaried people, students with a stipend and small business owners who cannot set aside a big lump sum but can commit a few thousand rupees every month. Parents often open an RD to fund a school fee due next year. The question the calculator answers is: if I deposit this much every month for this many months, what will I have at the end?
1. Write down the monthly instalment M, the annual rate r as a percentage and the number of months N.
2. Recognise that the first instalment stays for N months, the second for N − 1 months, and so on, with the last staying for just one month.
3. For an instalment that stays k months, its maturity value is M × (1 + r ÷ 400)^(4k ÷ 12), since interest compounds quarterly.
4. Work out this value for each k from 1 to N.
5. Add all N values. Maturity = Σ M × (1 + r ÷ 400)^(k ÷ 3), for k = 1 to N.
6. Subtract M × N, the total you deposited, to see how much of the maturity is interest.
An RD is easiest to understand as N separate small FDs opened one month apart, all maturing on the same day. The first instalment has the longest time to grow, and the last has only a month. Adding their maturity values gives the RD maturity. This is exactly what the calculator does. The formula uses quarterly compounding with a fractional number of quarters, which is the convention in the standard formula Indian banks publish for RDs.
If you deposit ₹5,000 a month for two years at 7%, the total deposit is ₹1,20,000, but your average rupee has been in the account for only about a year. That is why RD interest looks small compared with an FD of the same total amount held for the full two years. A quick estimate is interest ≈ total deposited × rate × (N + 1) ÷ 24 ÷ 100, which ignores compounding and so slightly understates the true figure.
The calculation assumes every instalment is paid on time. If you skip or delay one, banks usually charge a small penalty, and that instalment earns interest for fewer months. The rate is fixed on the day you open the RD, so later changes in the bank's rate card do not affect your account. If you want your savings to grow with rising income, you can open a second RD later rather than trying to change the first.
Pooja, a nursing student in Kochi, starts an RD of ₹3,000 a month for 36 months at 6.8% to pay for a certification course after graduation.
Answer: Maturity amount ₹1,20,035; Interest earned ₹12,035; Total deposited ₹1,08,000
Calculating interest as if the whole deposited total had been in the bank from day one.
Using monthly compounding when the bank compounds quarterly, or the other way round.
Missing instalments and still expecting the calculated maturity amount.
Assuming RD interest is tax-free. It is taxed like FD interest and can attract TDS.
Choosing a longer tenure than the goal date, which forces a premature closure with reduced interest.
Saving for a known expense such as school fees, a festival or a two-wheeler down payment.
Building a first emergency fund from a monthly salary.
Comparing a bank RD with a post office RD or a mutual fund SIP.
Teaching teenagers the habit of saving a fixed amount every month.
How is an RD different from an FD?
An FD is one lump amount deposited just once. An RD is a series of equal monthly deposits — useful for building up savings little by little, instead of all at once.