Are you looking for a hassle-free way to maximize your savings? Look no further! Introducing our user-friendly recurring deposit calculator, designed to help you make the most of your hard-earned money.
Whether you’re saving for a down payment on a house, a dream vacation, or simply want to build a nest egg for the future, the Recurring Deposit calculator is here to assist you every step of the way.
Don’t let your savings sit idle in your bank account. Start maximizing your returns today with our user-friendly recurring deposit calculator. Take control of your financial future and watch your savings grow steadily over time.
Table of Contents
What is a recurring deposit?
A recurring deposit is a simple monthly deposit scheme wherein investors deposit a fixed amount every month for 6 months -10 Years.
The interest rate is guaranteed for the entire duration. The investor gets a fixed amount at the end of the duration.
How does a recurring deposit work?
- Just fill in a recurring deposit form ( online or offline ).
- Choose the monthly deposit amount
- Choose investing tenure
- pay the ( recurring) instalments monthly
- Take maturity at the end of the paying duration.
Understanding the benefits of a recurring deposit
- Safe & Guaranteed Scheme – RD is a safe and secure monthly deposit scheme that inculcates a saving habit amongst investors.
- Guaranteed Interest rate – The interest rate is fixed and guaranteed initially.
- Fixed maturity Amount – The maturity is well known at the beginning itself. So, no surprises later.
- Flexible Saving Tenure – Investors can choose from varied tenures of 1/2/3/5 years.
- Use as a collateral – RD can be used as a Loan collateral.
- Senior Citizen Interest rate – Senior Citizens usually get higher interest rates.
What are the Disadvantages of RD
- Low Interest rates – The interest rate is low as compared to other investment product.
- Non-Payment Penalty – If you do not pay the RD monthly instalment, you can reinstate RD with a penalty.
- Premature Withdrawal – If you withdraw prematurely, you get a lower interest rate, which is usually 1 % lower than the RD rates.
- Taxable Profit – The gains (Interest amount) from RD maturity are fully taxable.
- No tax Deduction U/S 80C – There is no tax deduction for the deposit amount.
How much is 5000 per month in RD for 5 years?
As per the Recurring Deposit Calculator, If the interest rate is 6.7% for 5 years, you will get Rs. 3.57 lac at the end of 5 years.
Is recurring deposit a good investment?
RD is a safe investment with no risk. In an RD scheme, you have to deposit a fixed amount every month. The interest rate is low if you compare the return with a Mutual Fund SIP. But RD carries a lower risk.
RD is a safe monthly deposit scheme. But returns can’t beat the inflation rate.
Conclusion
A recurring deposit is a good investment scheme when you do not want to take any risk and need an assured secure return. The best part is the well-known maturity amount. This awareness makes you a confident investor and you get fully equipped for your short-term goals. Investing for long terms does not seem to provide good output as compared to other investments.
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