Recurring Deposit Interest Rates
Recurring deposit is one of the most famous types of saving along with the fixed deposit. It is actually a form of the term deposit which allows the person to deposit some fixed amount in a bank on a periodic basis. The best thing about recurring deposit is that person will be enjoying the Recurring Deposit Interest Rates higher rate as a fixed deposit as they do to a savings account when compared.
The question striking your head must be that what the difference is if the interest is same in an RD and a fixed deposit. So, the answer to this question is that there is a difference in FD and Rd and the difference is that the recurring deposit will just allow people to make some ongoing investments on period basis in the deposit, whereas the fixed deposit is the thing where you will have to fix the total amount at the same time when you will open the fixed deposit account. For an example, if you have no big amount like Rs. 20,000 at a time, then you can deposit a small amount every month to the RD and get a higher interest rate than you get on your regular savings bank account.
Recurring deposit is the best way to save money for those who cannot give a large sum at one point but can invest smaller amount on the periodic basis. Deposition of money in RD can also be done by a standing order with the bank which will automatically deposit it. The bank will cut the amount that you will be specifying and it will be transferred to RD account. This is an automatic saving and it also ensures that you have a fixed amount to be taken out of on some periodic and regular intervals. When the RD reaches its maturity, the total amount of the principal plus interest will directly be credited to the account.
There are many features of RD that you must know and they are | Recurring Deposit Interest Rates
- You can deposit money on the continuity basis instead of one-time payment.
- Perfect for the ones who have stable, regular income who cannot give a large amount for opening FD.
- For a pre-determined fixed tenure that can stay for few months to some years.
- You will get higher interest rates than the normal savings bank account.
- You will have regular, ongoing services.
- You can withdraw even before the maturity ends if you need.
- Famous saving form as it is at low risk and safety.
- This one has low returns if compared to other investment firms.
Some great deals are waiting for you at Yepme Shoes
When it comes to the recurring deposit interest rates, RD has higher interest rates to offer like an FD. There are some banks who offer higher interest rates on RD than FD and they are just by a margin. The interest rate on the recurring deposit varies with the bank. Plus, the interest rates that are offered on the recurring deposits can also change and that too at any time. The rate stays the same for the deposit’s complete period once RD account is opened. If the time period for your RD is 3 years, you will get the same rate for 3 years. The interest rates can range between 6%-9% and this is the general range. The compounding is done on the quarterly basis as the rates are same for the period of RD. Senior citizens can have higher interest rates on recurring deposits. It can be 0.25%-0.5% higher than the regular interest rate on RD.
ALSO SEE: Zero Balance Saving Account
Before going to opening a recurring deposit account, research about the interest rates that different banks are offering for the various tenures. You can check the websites and compare the recurring deposit interest rates from different banks and see who are offering higher rates. Mostly offer 7-8% per annum with different variations which depend on tenure and amount. Do check the latest interest rates on the recurring deposit account as the interest rates on RD keeps on changing and they can get low too if at one time they were the highest. So, keep the resources updated so that you get the benefit and the highest interest rates on the recurring deposit account that you are going to open.