What is this calculator?
This calculator works out the maturity value of a recurring deposit — a fixed amount saved every month into an account that pays compound interest. Each monthly deposit earns interest for however long it remains in the account, so the earliest deposits contribute the most.
Use it when:
- You are planning a monthly savings habit and want to know what it reaches.
- You want to separate what you deposited from what the bank paid you.
- You are comparing a recurring deposit against saving the same amount elsewhere.
Intended for: Savers building a corpus through equal monthly deposits at a guaranteed rate.
How is this calculated?
- The tenure is converted to a whole number of monthly deposits.
- The annual rate is converted to a monthly rate by dividing by 12 and by 100.
- Each deposit is compounded forward for the number of months it stays in the account — the first deposit for the full term, the last for one month or none, depending on deposit timing.
- Summing the compounded value of every deposit gives the maturity amount.
- Total deposits is the monthly amount times the number of months; interest earned is the difference.
Formula
Maturity amount
M = D × ((1 + r)^n − 1) / r × (1 + r)^t
The future value of n equal deposits, each compounded for the months remaining after it was made.
- D
- Monthly deposit amount
- r
- Monthly rate = annual rate ÷ 12 ÷ 100
- n
- Number of monthly deposits
- t
- 1 for start-of-month deposits, 0 for end-of-month
Example
Depositing 5,000 per month for 12 months at 7% per year, at the end of each month.
- The monthly rate is 7 ÷ 12 ÷ 100 ≈ 0.005833.
- The first deposit compounds for 11 months, the second for 10, and so on.
- Total deposits are 60,000; the compounded total is approximately 61,879.
Result: Maturity amount ≈ 61,879, total deposits 60,000, interest earned ≈ 1,879.
Frequently asked questions
Why is the interest lower than on a fixed deposit at the same rate?
Because your money is not all invested for the full term. In a recurring deposit the last month's money earns almost nothing, whereas in a fixed deposit the entire sum earns for the whole period.
What happens if I miss a monthly deposit?
Banks typically charge a penalty and may reduce the maturity value. This calculator assumes every deposit is made on schedule.
Is the interest taxable?
In most jurisdictions, yes, and banks may deduct tax at source. The maturity amount shown here is before tax.
Assumptions
What this calculator takes as given:
- The interest or return rate you enter is treated as fixed for the entire period.
- Every period is treated as equal in length; no calendar-day, leap-year, or day-count convention is applied.
- Every monthly deposit is made in full and on schedule.
- Tenure is treated in whole months.
Limitations
What this calculator cannot know or does not model:
- Penalties for missed or delayed deposits are not modelled.
- Tax on interest, including deduction at source, is not applied.
- Premature closure penalties are not modelled.
- Banks differ slightly in their day-count and rounding conventions, so a passbook figure may differ marginally.