Credit Score powered by our Bureau Partners 
® | 
Is your Credit Score >750?
- Get low interest loans & Lifetime FREE credit cards
- Get customized Credit Health Report
- Improve your creditworthiness
Total Interest : ₹5,679
Maturity Amount : ₹35,679
Invested Amount : ₹30,000
Invested Amount
Total Interest
It is important to understand how the scheme works, its rules, benefits, and even what happens if you miss a deposit. Also learn how to use the Post Office RD Calculator, a handy tool that helps you quickly figure out your maturity amount, monthly deposit needs, and total interest earned. Whether you’re planning for future goals or just starting your savings journey, this guide will help you use the RD scheme effectively.
How to Use the Post Office RD Calculator from CreditMantri?
CreditMantri Post Office RD Calculator is a simple tool to help you plan your post office RD investment. It shows the interest earned, and the total amount you will get at maturity, based on the total amount you have invested. Here’s how to use it:
Steps to Use the Post Office RD Calculator
Step 1: Enter the amount you want to save every month (e.g., ₹500).
Step 2: Select the tenure; in this case, it will be 5 years as it is a fixed tenure for this scheme.
Step 3: The calculator will use the current interest rate (6.7% per year).
Step 4: It will show:
- Total money you invested.
- Interest you earned.
- Maturity amount at the end of scheme tenure.
It is as simple as that. This post office RD calculator helps you plan your investment for a long-term goal like your kids’ higher education, marriage, retirement investment, family holiday, etc;
How is the Post Office RD Maturity Amount Calculated?
The formula for the Post Office 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:
Month | Formula | RD Maturity Amount |
|---|---|---|
1 | 1000(1+0.05/4)^(4*1/12) | 1004.15 |
2 | 1000(1+0.05/4)^(4*2/12) | 1008.31 |
3 | 1000(1+0.05/4)^(4*3/12) | 1012.5 |
| Total | 3025 |
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.
Read about 'How Recurring Deposits Are Calculated?’ for better understanding on RD interest calculation
Benefits of Using the Post Office RD Calculator
The Post Office RD Calculator is a helpful tool for anyone planning to save money through the Post Office Recurring Deposit scheme. Using the Post Office RD Calculator ensures that you can plan your savings confidently. It’s a fast and easy way to understand how much you’ll earn from your investment.
- Accurate Planning - The calculator gives exact results for your savings, interest, and maturity amount.
- Easy to Compare Options - Try different monthly deposit amounts or durations to see how they affect your final savings.
- Saves Time - No need for manual calculations; the tool gives instant results.
- User-Friendly - Simple design makes it easy for anyone to use, even without technical knowledge.
- Adjustable Inputs - Change the monthly deposit or tenure to find the best savings plan for your needs.
- Helpful for Budgeting - Know exactly how much you need to save every month to reach your financial goals.
- Free to Use - Access the calculator anytime without any charges.
Highlights of the Post Office RD Interest Rates
The Post Office RD scheme stands out for its safety, fixed returns, and reliable government backing, making it a preferred choice for risk-free savings.
The interest rate for the Post Office Recurring Deposit (RD) scheme is fixed at 6.7% per annum (as of January 2024). This rate is compounded quarterly, helping your savings grow steadily over time.
- Fixed Rate - The current interest rate is 6.7% per year, offering stable and predictable returns.
- Quarterly Compounding - Interest is calculated every three months, which means your money grows faster.
- Applicable to All Accounts - The same rate applies whether the account is individual, joint, or opened for a minor.
- Post Office RD offers government-backed security, while banks may offer slightly higher rates but with variable terms.
- Most banks provide RD interest rates ranging between 5.5% to 7%, depending on the tenure and bank.
- NBFCs (Non-Banking Financial Companies) may offer competitive rates but do not have the same level of security as Post Office schemes.
Post Office RD vs Bank RD
Post Office RD vs NBFC RD
Click here to read more about Post Office Interest Rates
Tax Implications on Post Office RD Investment
While the Post Office RD scheme offers safe and steady returns, it’s essential to consider the tax implications on the interest earned. Planning ahead can help you manage taxes effectively.
- No Tax Benefits - The money you deposit in the Post Office RD account does not qualify for tax deductions under Section 80C of the Income Tax Act.
- Interest is Taxable - The interest you earn on your RD is added to your total income and taxed based on your income slab.
- TDS Applicability - If the total interest earned exceeds ₹40,000 in a financial year (₹50,000 for senior citizens), TDS (Tax Deducted at Source) will be deducted at 10%.
How to Manage TDS on Post Office RD?
- Submit Form 15G/15H - To avoid TDS deductions, submit these forms if your total income is below the taxable limit.
- Track Interest Income - Keep a record of the interest earned to report it while filing your Income Tax Return (ITR).
- Claim Refunds – At the time of filing your ITR, you can claim a refund if extra tax was deducted.
How to Invest in 5-Year National Savings Recurring Deposit Account
Investing in the Post Office 5-Year RD scheme is easy. Follow these steps to open your account:
Step 1: Visit your nearest post office and get the relevant RD account opening form.
Step 2: Fill & submit the duly filled application form.
Step 3: Submit documents like ID proof, address proof, and a passport-size photo.
Step 4: Choose your monthly deposit amount (minimum ₹100).
Step 5: Pay your first deposit in cash or cheque.
Step 6: Collect your passbook to track your deposits and account balance.
Important Points to Remember
- Deposit Amount - You can deposit a minimum monthly amount of ₹100, and in multiples of ₹10 thereafter.
- Monthly Deadline - Deposit before the 15th if opened earlier in the month or by the last working day if opened later.
- Missed Payments - Missed deposits can be cleared later with a small penalty.
Post Office RD Calculator FAQs
1. How much interest is offered on Post Office Recurring Deposit (RD) scheme?
The scheme gets an interest rate of 6.7% per annum.
2. How can I calculate the maturity amount for my Post Office RD?
CreditMantri provides this easy Post Office RD Calculator to calculate your maturity amount. Just enter your monthly contribution amount, duration as well as the interest rate and you may view total savings, interest earned, and the final amount.
3. Can I withdraw money from my Post Office RD before maturity?
In case of any emergency, after a period of 3 years, the Post Office RD account can be closed prematurely but the interest earned will be adjusted to the Post Office Savings Account rate.
4. How much can I invest in Post Office RD scheme?
This scheme can be opened with just ₹100 per month.
5. Should I pay tax on the Post Office RD interest amount?
Yes, Post Office RD interest amount attracts tax as per your tax slab. If the total interest exceeds ₹40,000 (₹50,000 for senior citizens) in a financial year, TDS (Tax Deducted at Source) will be applied at 10%.
6. What is the loan facility offered against my Post Office RD account?
Depositors can avail a loan of up to 50% of the available balance in their RD account to meet any unforeseen emergencies. This loan option is available once you have paid at least 12 instalments. You need to pay an interest of 2% more than the prevailing RD interest rate.
Disclaimer : This page includes information that has been compiled from many sources and is only offered for informational purposes. Since this type of data might change over time, we cannot guarantee that the information supplied or included within it is accurate. It is anticipated that the user would confirm with the relevant source before taking any choices or actions.