Post Office Savings Calculator

The recurring deposit formula

A post office recurring deposit compounds quarterly and each instalment earns for a different length of time:

M = P × ((1 + i)ⁿ − 1) ÷ (1 − (1 + i)^−1/3), where i = annual rate ÷ 400 and n = quarters.

With i = 0.01875 and n = 20, the factor is about 72.9, so 5,000 × 72.9 ≈ ₹3,64,500 — the small difference from 3,64,449 comes from rounding the instalment timing.

Worked examples

₹5,000 for 5 years at 7.5% → ≈ ₹3,64,449 (₹3,00,000 deposited)
₹5,000 for 5 years at 6.7% → ≈ ₹3,56,800
₹10,000 for 5 years at 7.5% → ≈ ₹7,28,900
₹5,000 for 10 years at 7.5% → ≈ ₹8,86,000

Why the first instalment matters most

The deposit made in month one compounds for the full sixty months; the last one compounds for a single month. That is why extending the term has a larger effect than raising the instalment late in the term: every rupee deposited early has more time to earn. A ten-year term at the same rate more than doubles the maturity value while only doubling the deposits, because the later years are earning on a much larger balance.

Practical points

• Premature closure usually pays a lower rate, and partial withdrawal is not allowed on a post office RD.
• Missed instalments attract a small default fee and the account can be closed if several are missed.
• Rate resets apply to new accounts; an existing RD keeps the rate it was opened at.
• Tax on the interest follows your slab, and TDS applies above the threshold.

Frequently Asked Questions