Estimate your maturity value based on systematic monthly savings.
Total Invested Amount:0
Total Growth Earned:0
Maturity Value:0
Understanding the Recurring Deposit Growth Logic
A Recurring Deposit (RD) is a financial tool that allows individuals to save a fixed amount regularly every month over a specified period. Unlike a fixed deposit where you invest a lump sum, the RD encourages systematic savings habits while earning a return on every installment deposited.
How the Calculation Works
The maturity value of a Recurring Deposit is calculated using a formula that accounts for the periodic nature of the deposits. Since the first installment stays in the account for the full duration and the last installment stays for only one month, the growth is weighted accordingly. Most institutions use quarterly compounding for these calculations.
The standard formula used:
M = R * [(1+i)^n – 1] / (1 – (1+i)^(-1/3))
Where:
– M is the Maturity Value.
– R is the Monthly Installment.
– n is the number of quarters.
– i is the annual rate divided by 400.
Example Scenario
Suppose you decide to save 2,000 every month for 12 months (1 year) at an annual growth rate of 7%.
Total Principal: 2,000 x 12 = 24,000
Estimated Growth: Using the compounded formula, the earned return would be approximately 920.
Maturity Amount: You would receive roughly 24,920 at the end of the year.
Benefits of Using a Systematic Savings Plan
Disciplined Saving: It forces a monthly commitment toward a financial goal.
Compounding Power: Even small monthly amounts grow significantly over long durations (5-10 years).
Low Entry Barrier: Most accounts can be started with very small amounts compared to other investment vehicles.
function calculateRD() {
var p = parseFloat(document.getElementById("monthlySum").value);
var r = parseFloat(document.getElementById("yieldRate").value);
var n = parseInt(document.getElementById("tenure").value);
if (isNaN(p) || isNaN(r) || isNaN(n) || p <= 0 || r <= 0 || n <= 0) {
alert("Please enter valid positive numbers for all fields.");
return;
}
// Standard RD Calculation (Monthly compounding for general approximation)
// Formula: M = P * ((1 + i)^n – 1) / i * (1 + i)
// where i is monthly rate
var i = (r / 100) / 12;
var maturityValue = p * ((Math.pow(1 + i, n) – 1) / i) * (1 + i);
var totalInvested = p * n;
var totalInterest = maturityValue – totalInvested;
document.getElementById("totalInvested").innerHTML = totalInvested.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById("totalInterest").innerHTML = totalInterest.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById("maturityValue").innerHTML = maturityValue.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById("resultsArea").style.display = "block";
}