Post Office RD Calculator

Post office recurring deposits are among the most popular investment options when compared to fixed deposits, saving schemes offered by banks, or even other saving schemes offered by the post office. One of the major reasons for post office recurring deposits being so popular is the attractive interest rates they offer and the high maturity amount one can earn on them. An online Post office RD calculator will help you know the maturity amount and interest earned before investing. This will help you plan your deposit accordingly. Results are displayed instantaneously while manually computing the same would be very cumbersome. So use the post office RD calculator on CreditMantri and get the benefit of instant results. Enter the monthly investment, time period, and the rate of interest in the post office RD calculator, and the maturity amount and the interest accrued will be displayed instantly.

How to Use the Post Office RD Calculator?

Follow the steps below to use the Post Office Recurring Deposit Calculator on the CreditMantri website.

• Step 1 : Enter the amount you desire to deposit on a monthly basis
• Step 2 : Input the applicable interest rate and the recurring deposit duration.
• Step 3 : The post office recurring deposit calculator will display the total amount invested, interest accrued, and maturity amount.

Benefits of Recurring Deposits

• Recurring deposits are very useful for people with low salaries and low incomes. They just have to invest a small amount every month. The investment amount can be as low as Rs. 10.

• The investor has to deposit a part of his income regularly, so it develops the habit of saving.

• An RD account can be linked to the savings account, so it does not require any documentation work.

• Mutual funds and stocks are exposed to market risks. However, the amount invested will be safe in RDs and will mature along with the interest at the end of the fixed duration.

• RD allows premature withdrawals, but it comes with a small penalty.

• RD can be used as collateral for taking loans. You can take upto 80% to 90% loans on your RD amount.

• Senior citizens get a higher rate of interest, about 0.5% more, for recurring deposits.

• Minors can also open RD accounts under the custody and guardianship of their parents.

• The tenure is flexible and you can choose from 7 days to 10 years.

How is the RD Maturity amount Computed?

The formula for the RD maturity amount is as follows:

M = P*(1+R/N)^(Nt)

Where M is the maturity amount

P is the amount invested each month.

R is the rate of interest (R is divided by 100 and substituted in the formula)

N is the compounding frequency (In most banks and financial institutions, the RD is compounded quarterly).

t is the tenure in months.

Let us take an example: A person invests Rs. 1000 monthly in an RD with an interest rate of 5% for a period of 3 months. What is the maturity amount of the RD?

The maturity is computed as follows:

As you can see from the above, it is quite cumbersome to calculate the maturity amount manually. To simplify the process and to get instantaneous results, you can use a recurring deposit calculator.

FAQs