IOB RD Calculator

The IOB Recurring Deposit (RD) calculator is a valuable tool for investors looking to systematically save money for the long term. It operates based on regular monthly payments and allows users to choose the deposit tenure and monthly contribution according to their preferences.

Recurring deposits are financial services provided by many banks, enabling individuals to make consistent deposits and earn returns on their investments. The interest rates for RDs are calculated on a quarterly compounded basis, similar to those offered for fixed deposits. The IOB RD calculator facilitates investors in estimating the potential returns and planning their savings effectively.

The interest on Recurring Deposits (RDs) is determined by banks and varies with the investment tenure. RD interest is compounded quarterly after an initial period of earning simple interest.

For example, if an investor starts an RD in June, they earn simple interest until September, after which interest is compounded quarterly. The quarters for RD investments are April to June, July to September, October to December, and January to March.

The formula for calculating Post Office RD interest and maturity value is:

M=R*[(1+i)^(n-1)]/(1-(1+i)^(-1/3))

Where, M = Maturity value

R = Monthly Instalment

N = Number of Quarters (tenure)

i = Rate of interest

For instance, if you deposit Rs. 10,000 monthly for 5 years at a 5.8% interest rate

M = 10000[(1+5.8)5 – 1]/1-(1+5.8)(-1/3)

This results in a maturity amount of Rs. 6,96,967, indicating an interest of Rs. 96,967 on the total deposit of Rs. 6,00,000.

Using an RD calculator involves a straightforward process:

Using an IOB RD calculator offers several benefits:

Fixed Deposits (FD) and Recurring Deposits (RD) are both popular investment options, each serving different financial needs. Here's a brief comparison:

Fixed Deposit (FD):

Recurring Deposit (RD):