Recurring Deposit vs FD Calculator

## What is the Recurring Deposit vs FD Calculator? The RD vs FD Calculator compares the maturity values of a Recurring Deposit (where you invest a fixed amount monthly) versus a Fixed Deposit (where you invest a lump sum once). Since RDs involve monthly deposits starting from the first month, while FDs have the entire principal from day one, FDs typically yield higher returns for the same total investment amount. ## Formula Used RD Maturity = Monthly Deposit x ((1+r/n)^(n x t) - 1) / (r/n) FD Maturity = Principal x (1 + r/n)^(n x t) For equal comparison: Total RD Investment = Monthly Deposit x Months Total FD Investment = Lump Sum from Month 1 At the same interest rate, FD always gives slightly higher maturity because the entire principal is invested from day one vs monthly instalments in RD. ## Worked Example Monthly RD: Rs 10,000, Rate: 6.5% p.a., Tenure: 24 months RD Maturity = Rs 2,56,980 Total RD Investment = Rs 2,40,000 Interest Earned = Rs 16,980 Equivalent FD (monthly RD total deposited upfront): Rs 2,61,030 FD Advantage = Rs 4,050 ## Frequently Asked Questions 1. Which gives better returns — RD or FD? FD gives slightly better returns than RD at the same interest rate because the entire principal is deposited from day one. For example, Rs 10,000/month in RD for 24 months at 6.5% earns a maturity of Rs 2,56,980. The equivalent FD earns Rs 2,61,030 — Rs 4,050 more. 2. When should I choose RD over FD? Choose RD when: you have a regular monthly income (like a salaried employee) and prefer depositing a fixed amount each month rather than saving up a lump sum first. Choose FD when: you have a lump sum amount already saved. 3. Are RD and FD interest rates the same? In most banks, RD and FD rates are similar for the same tenure. However, some banks offer slightly higher FD rates for senior citizens or for specific tenure buckets. 4. What happens if I miss an RD instalment? Missing an RD instalment typically results in a penalty (usually Rs 10 to Rs 50 per missed instalment) and the bank may convert your RD to a lower amount for the remaining tenure. 5. Is TDS deducted on RD and FD interest? Yes, TDS is deducted on both RD and FD interest if the annual interest exceeds Rs 40,000 (Rs 50,000 for senior citizens). Submit Form 15G/15H to avoid TDS if your total income is below the taxable limit.