How RD interest works
Each monthly deposit earns interest from the month it is paid, compounded quarterly. The calculator adds up every instalment:
Maturity = Σ P × (1 + r/4)4 × (months left ÷ 12)
₹5,000 a month for 5 years at 6.7% (the Post Office rate for October–December 2026) gives about ₹3,56,829 from ₹3,00,000 deposited.
RD or SIP?
An RD guarantees the amount, but after tax at a 20–30% slab, the real return is often close to inflation. A SIP in an equity fund can grow much more over 7+ years but can also fall. Many people keep short goals (under 3 years) in RDs and long goals in SIPs.
Tax
RD interest is taxable at your slab rate and counts toward the ₹50,000 TDS limit (₹1 lakh for seniors) with that bank.
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Questions people ask
What if I miss an RD instalment?
Banks charge a small penalty, often ₹1.50–2 per ₹100 for each month of delay. At the Post Office, after four missed instalments in a row the account is discontinued, but it can be revived within two months.