Recurring Deposit Interest Rates Calculators and Its Eligibility | Motilal Oswal

Calculators for Recurring Deposit Interest Rates

A recurring deposit is a distinct financial instrument offered by banks in India. It is also known as an RD. This is essentially a term deposit and an effective investment tool that offers individuals the opportunity to make deposits at intervals to earn fairly good returns on any capital invested. As a result of the factor of making regular deposits, and recurring deposit interest rates, recurring deposits offer flexibility and easy ways to invest for the less risky investors among us all. 

Features of Recurring Deposits

There are many choices you have to invest your capital today. It all depends on your individual financial goals and the kind of investor you are. If you have a high risk appetite, you won’t mind equity investment and open a demat account for the same. In case you have a low risk tolerance level, you may opt for a recurring deposit. Recurring deposits offer investors opportunities to deposit a fixed sum of their choice every month. Most banks and non-banking financial corporations offer these to customers. Tenures may range from six months to ten years. Generally, recurring deposit interest rates can range from 2.90% to 7.25% for every year in the case of general customers. For senior citizens, the rates stand at additional rates that range from 0.50% to 0.80%. 

Before You Start an RD 

Before you think of going in for an investment with a recurring deposit (RD), you will obviously do some research about different rates of interest that banks offer. Investors want the highest rates of interest possible, considering that interest rates have fallen with bank deposits sharply over the past months. In fact, there are those investors who would rather invest in an upcoming IPO or stocks rather than deposits of a fixed income nature. Still, several kinds of investors exist and if you wish to opt for a recurring deposit, you should use an RD interest calculator to know what your return on investment will eventually be. RD calculators are online tools which give you calculations and amounts easily, based on information that you feed in. Before you begin an RD, you should also get some idea about your own eligibility to invest. 

Eligibility Criteria for a Recurring Deposit

If you wish to open a recurring deposit, you can log in to any bank website to know about recurring deposit interest rates and other information. Criteria for eligibility to start a recurring deposit is also mentioned, but here some general criteria for eligibility: 

  • Any individual Indian citizen can opt for a recurring deposit.
  • Minors can also open recurring deposits, with a guardian present. 
  • Individuals must provide all documents required for KYC clearance
  • Organisations are also eligible to opt for recurring deposits. 

The RD Calculator

As the name suggests, a recurring deposit is an investment of a continuing nature. Therefore, any returns on investment can be a challenge for investors to track. The interest that is generated by any RD is accrued on a quarterly basis and this is compound interest. Calculations can take on multifold aspects as there are different variables that are involved. 

An RD interest calculator can be of help if you wish to eliminate the problems of calculating returns manually. With an RD calculator, an investor can know precisely what interest deposits can accrue in a relevant tenure. In this way, investors know how much to invest. In a standard RD calculator, investors must enter the recurring deposit instalment they wish to deposit each month, the interest accrued and the tenure of the deposit. The RD calculator automatically computes the amount of interest collected by the maturity date. 

Success When You Invest

The RD calculator gives you an accurate estimate of your returns, so you know how much you should invest to reach your financial goals. It saves you time and effort in making your investments work for you. It is easy to operate online tools and if you have had to open a demat account online, you will be used to online use of certain tools. With technology these days, any investment and related functions are available online, including operating an RD calculator or subscribing to any upcoming IPO. 

 

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