How RD maturity is calculated
Banks credit RD interest with quarterly compounding on your running balance. This calculator simulates every month of your RD — each deposit earns interest for exactly the time it stays in the account — matching how banks compute maturity far better than simple-interest shortcuts.
RD vs SIP vs FD
- RD: guaranteed rate, disciplined monthly saving, fully taxable interest.
- SIP: market-linked, historically higher long-term returns, no guarantee.
- FD: lump sum instead of monthly; same guarantee and taxation as RD.
FAQs
What happens if I miss an RD instalment?
Banks charge a small penalty (often ₹1–2 per ₹100 per month of delay) and repeated defaults can close the RD. Post office RDs allow revival with penalty.
Is TDS deducted on RD interest?
Yes — RD interest counts with your FD interest for the bank's TDS threshold, and it's taxable at your slab rate either way.