How does the RD Calculator work?
A Recurring Deposit (RD) allows you to save a fixed amount every month with your bank, earning an interest rate similar to a Fixed Deposit. Indian banks calculate RD interest based on quarterly compounding.
Intelligence Insight: RDs are excellent for short-term goals (1-3 years) where capital protection is critical. However, for long-term goals (5+ years), consider SIPs in equity mutual funds to comfortably beat inflation.
The Formula
M = P × (1 + r/n)^(n*t)
Unlike an FD where you deposit the money once, an RD involves monthly deposits. Therefore, the formula is applied to each monthly deposit based on the time remaining until maturity. Our calculator automatically handles this complex summation to provide you with an exact figure.