RD Calculator Online
A Recurring Deposit (RD) Calculator is a tool used to calculate the maturity value of an RD account. It considers the deposit amount, tenure, and interest rate to determine the total amount received at the end of the RD term. It helps people plan their investments and savings.
What is Recurring Deposit (RD)?
A Recurring Deposit is a savings option where an individual invests a fixed amount of money regularly, usually every month. The investment period and interest rate had fixed in advance, and the investor earns interest on the deposit at the last of the term.
The amount invested in an RD is relatively low compared to other investment options, making it accessible to a wider range of individuals. This investment tool had designed to promote disciplined saving and provide an attractive return on investment.
What is Recurring Deposit Calculator?
A Recurring Deposit (RD) Calculator is a financial tool used to determine the maturity value of a recurring deposit account. It factors variables such as the deposit amount, tenure, and interest rate to calculate the total amount received at the end of the RD term. It helps individuals plan their investments and make informed decisions about the amount they can save and earn from an RD account.
How Does Recurring Deposit Calculator Work?
The Recurring Deposit calculator uses the compound interest formula, as the interest you obtain from the periodic investments in Recurring Deposits keeps compounding throughout the investment. However, the RD formula only allows you to calculate RD returns for the first period. You have to calculate as many times as your number of period investments. The formula to calculate Recurring Deposits is as follows:
A = P x (r/100 + 1)^nt
Where,
A:Total amount by the last of the period
P:Starting compounding Principal amount
r:rate of interest at Annual
n:number of times interest compounds in an annum
t:number of years
Using the formula to calculate RD returns is complicated and time-consuming. Furthermore, a small numerical error can give you very different results. Therefore, using an RD interest rate calculator is wise to save you time and give accurate results every time.
How can you use RD Calculator?
Unless you are an algebra fan, there is an easy-to-use online Recurring Deposit calculator that you can use. All you need to do is the following.
- Type in the monthly deposit amount
- Type in the expected rate of interest and the tenure
- Tap 'calculate.'
- You will get your maturity amount so quickly.
Tax Benefits on RD Calculator:
Like other personal tax-saving and investment instruments, Recurring Deposit schemes also attract taxes. A TDS of 10% is deducted from the returns accrued from an RD if the total interest exceeds Rs. 10,000 in a single financial year.
Compare this to the SIP scheme, and you can see that SIPs are more beneficial in the long term. Since long-term gains from equity are tax-free, any SIP which invests in ELSS (Equity Linked Mutual Funds) is also tax-free after one year.
Advantages of Using the RD Calculator:
Some of the advantages of using the RD Calculator had mentioned below:
- Accurate estimations had provided.
- It saves time and is convenient.
- You can plan your finances in the long run.
Conclusion:
RD Calculator is useful for anyone considering investing in an RD account. It helps to calculate the maturity value of the account based on the deposit amount, tenure, and interest rate. It can help individuals make decisions about their investments and savings goals. Overall, it's a valuable resource for financial planning.
Faqs:
What are the benefits of using the RD calculator?
The RD calculator is a simple online tool that produces results in seconds. It saves time by eliminating the want to perform complex calculations. You can use this calculator multiple times to compare the returns from different recurring deposit investments.
How is the interest earned on an RD account calculated?
The interest earned on an RD account had calculated using the compound interest formula. Even though deposits must make monthly, the interest had compounded quarterly.
How is RD calculated?
The formula used is A = P(r/n +1) ^ nt, where 'A' represents the final amount procured, 'P' represents the principal, 'r' represents the interest rate, n represents the number of times that interest had compounded, 't' represents the tenure.
How does the RD calculator work?
Yes, you can calculate returns from your RD investment using the formula A = P x (1 + r/100)^nt, where A = Total amount by the end of the period. P = Principal amount from which compounding will start. r = Annual rate of interest.
Can we stop RD in between?
Can I close my RD account online? Yes, you may close your RD a/c online through the "Close A/c" tab under e-RD, which is created through e-RD only. RD a/c created through other means can not close through the "Close a/c" tab under e-RD.
What is the rule of RD?
RD allows you to earn fixed interest on the amount invested until the investment matures or a predetermined term ends. The total amount (i.e., the capital invested and the interest accumulated) is disbursed to the investor after the maturity period completes.