Post Office 5-Year Recurring Deposit Calculator | Calculate Your RD Returns
Calculate your savings with a 5-year RD scheme at 6.7% interest compounded quarterly
Investment Summary
Growth Over Time
Key Takeaways
Quick Investment Options
Quarterly Breakdown
| Quarter | Monthly Deposit (₹) | Total Invested (₹) | Interest Earned (₹) | Quarter End Balance (₹) |
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For those looking to build a savings habit with the assurance of guaranteed returns, the Post Office 5-Year Recurring Deposit (RD) is a trusted and secure investment option. It encourages disciplined monthly savings and offers a fixed interest rate backed by the Government of India. Our comprehensive Post Office RD Calculator is designed to help you accurately estimate your maturity value, see the total interest earned, and understand how your consistent savings can grow over the 5-year term.
This guide will walk you through how to use the calculator effectively and provide a detailed explanation of the scheme’s features, interest rate, and tax rules, empowering you to make a sound financial decision.
Author’s Note: This calculator provides an estimate based on the data you enter and the current interest rate, which is subject to quarterly review by the government. The results are for informational purposes only and should not be considered financial advice. For personalized advice, it is always recommended to consult with a qualified financial advisor.
What is the Post Office Recurring Deposit (RD) Scheme?
The Post Office Recurring Deposit is a government-backed savings scheme that allows you to invest a fixed amount of money every month for a fixed tenure of 5 years. It is an ideal instrument for individuals who want to build a corpus through regular, disciplined savings without being exposed to market risks.
Key features of the scheme include:
- Fixed Tenure: The investment period is locked in for 5 years (or 60 monthly deposits).
- Guaranteed Interest Rate: The interest rate is fixed at the time of opening the account and remains constant for the entire tenure. For the current quarter, the interest rate is 6.7% per annum, compounded quarterly.
- Disciplined Savings: It helps instill a habit of regular saving with a minimum monthly deposit of just ₹100.
- Sovereign Guarantee: As a government-backed scheme, it offers complete safety for your principal investment.
How to Use the Post Office RD Calculator
Our calculator is designed for simplicity and accuracy. Follow these steps to project your investment returns:
- Enter Your Monthly Deposit Amount: Input the fixed amount you plan to invest each month.
- Calculate Your Returns: The tool will instantly compute your estimated maturity value, the total interest you will earn over the 5-year tenure, and the total principal amount you invested.
Why Choose a Post Office Recurring Deposit?
- Unmatched Safety: Being a government-backed instrument, the Post Office RD offers one of the highest levels of capital protection.
- Attractive Fixed Returns: The interest rate of 6.7% is competitive and is compounded quarterly, which helps your money grow faster over the 5-year period.
- Accessibility: With a low minimum deposit of ₹100 per month and no maximum limit, the scheme is accessible to investors from all income levels.
Important Rules and Considerations
- Taxation of Interest: The interest earned from a Post Office RD is fully taxable. It is added to your annual income and taxed according to your applicable income tax slab. It is a common misconception that Post Office RD investments qualify for tax deductions under Section 80C; however, this benefit is not applicable to this scheme. The Section 80C deduction is available for the 5-Year Post Office Time Deposit (Fixed Deposit), not the Recurring Deposit.
- Premature Withdrawal: While the RD has a lock-in period of 5 years, premature closure is permitted after 3 years from the date of opening the account. If you close the account early, you will receive the interest rate applicable to a Post Office Savings Account (currently 4%), not the RD interest rate.
- Loan Facility: After making 12 consecutive monthly deposits, you can avail a loan of up to 50% of the balance in your RD account. The interest on the loan is typically charged at 2% above the applicable RD interest rate.
Frequently Asked Questions (FAQs)
What is the current interest rate for a Post Office RD?
For the current quarter of the financial year 2024-25, the interest rate for the Post Office 5-Year RD is 6.7% per annum, and it is compounded quarterly.
Is the Post Office RD tax-free?
No. The interest earned on a Post Office RD is fully taxable as per your income tax slab. Furthermore, the principal amount you invest is not eligible for a tax deduction under Section 80C.
Can I withdraw my RD before the 5-year tenure?
Yes, you can close your Post Office RD account prematurely, but only after 3 years from the date of opening. If you do so, the interest paid will be at the lower rate applicable to a Post Office Savings Account.
How is the interest on a Post Office RD calculated?
The interest is compounded on a quarterly basis. This means that every three months, the interest earned is added to the principal, and this new, larger principal earns interest in the next quarter, leading to faster growth of your savings.
What is the difference between a Post Office RD and a Post Office Time Deposit (FD)?
A Recurring Deposit (RD) involves making regular, fixed monthly payments for the entire 5-year tenure. A Time Deposit (FD), on the other hand, involves investing a single lump-sum amount for a fixed tenure (1, 2, 3, or 5 years). The 5-year Time Deposit is eligible for tax benefits under Section 80C, whereas the Recurring Deposit is not.