Kotak RD Calculator – Calculate Interest & Maturity Online
Kotak RD calculator is an online tool that helps in calculating the wealth gained on an RD investment. In other words, it estimated the maturity and interest amount from an RD investment. Kotak Bank RD calculator is available online and is free to use.
What is a Kotak Bank RD Calculator?
Kotak Mahindra Bank RD calculator is an online tool that helps in estimating the interest earned by investing in a recurring deposit scheme. For RDs, the maturity amount is the total of all monthly investments and the interest earned during the investment period. Also, for recurring deposits, the interest compounding is done on a quarterly basis.
Kotak Mahindra Bank offers multiple schemes for varying tenures. One can choose between tenures ranging between 12 months to 120 months. Also, the minimum deposit amount for Kotak Mahindra Bank recurring deposit investment is in multiples of INR 5,000 and INR 10,000.
The Kotak Mahindra Bank recurring deposit calculator determines the interest amount and the investment value at a future date. The calculator is an easy-to-use tool, and works on the following inputs:
- Monthly deposit amount: Monthly investment amount towards a recurring deposit account.
- Interest rate: The interest income that an RD investment earns. Kotak bank determines the recurring deposit interest rates. The recurring deposit rate for different banks is available online.
- RD term (in years): The tenure of the recurring deposit investment.
On entering the above details, the RD calculator computes the following:
- Total investment: The total of monthly deposits in the scheme.
- Wealth Gained: Interest income from the recurring deposit scheme.
- Total Corpus created: The total of monthly investments and the wealth gained. In other words, it is the amount that one receives from their RD investments upon maturity.
How to use a Kotak RD Calculator?
The Kotak RD calculator is available online for free. It is easy to use and also a simple tool. One has to enter the details such as monthly deposit amount and Kotak Bank recurring deposit rate to determine the maturity value. The calculator helps in computing the wealth created from an investment. Furthermore, the Kotak RD calculator uses the future value formula to determine the investment’s maturity value. The following example helps in understanding the Kotak RD calculator better.
Ms Ramya plans to invest INR 50,000 per month in a recurring deposit scheme for ten years. The Kotak bank RD rate is 6.20%. The maturity value of the investment for Ms Ramya using the Kotak RD calculator is:
The following are the Kotak Bank RD Calculator inputs:
- Monthly investment amount: INR 50,000
- Axis Bank RD Interest Rate: 6.20%
- RD Term: 10 years
On entering the above inputs, the RD calculator computes the following:
- Total Investment: INR 6,000,000
- Wealth Gained: INR 2,311,715
- Total Corpus Created: INR: 8,311,715
The investment of INR 6,000,000 made today at 6.20% interest per annum would be INR 8,311,715 in ten years. Moreover, the interest income for Ms Ramya will be INR 2,311,715.
Benefits of using a Kotak Recurring Deposit Calculator
The following are some of the benefits of using the Kotak Bank RD calculator:
- Simple and easy to use: The calculator is a simple tool, and only requires few details to estimate potential returns.
- Saves time: The calculator computes the potential return and interest income faster, helping individuals perform complex calculations.
- Accurate results: It provides accurate results, and also has a zero chance for error.
- Comparison: One can use the RD calculator to compare different recurring deposit schemes. The comparison helps in finalising a scheme that benefits the investor the most.
- Future planning: The Kotak bank calculator estimates the returns from an investment, and helps in better financial planning. Moreover, estimating returns helps in planning investments and goals in a better way.
- Free to use: The calculator is available online for free. One can use it multiple times to compute and compare returns from different recurring deposit investments.
How is interest and maturity amount on an RD calculated?
The banks decide recurring deposit interest rates under the purview of RBI guidelines. The RD interest rates range between 5%-7% for most banks. Interest on RDs is compounded every quarter, and until then the RD will earn simple interest. For example, if an investor invests in an RD in August, the RD will earn simple interest until September. At the end of September, the interest will be compounded. In other words, the interest will earn interest. RD investment quarters are April to June, July to September, October to December, and January to March.
The formula for recurring deposit interest rate and maturity value
Using the following formula, one can calculate the maturity amount and interest earned from a Kotak Bank RD.
Where M is the maturity value
R is the monthly instalment. It is the amount the investor wants to invest on a monthly basis.
n = number of quarters. For RDs, the investment tenure is in quarters.
i = interest rate/400. The interest rate on Kotak Bank RD is set by Kotak bank under RBI guidelines.
Mr Karthik wants to invest INR 5,000 per month in an RD scheme for a tenure of 4 years or 48 months. The interest rate offered by the scheme is 6.20%. Mr Karthik can calculate the interest and maturity amount using the following formula.
M = 5000*[(1+6.2/400)^(48-1)](1-(1+6.2/400)^(-1/3))
M = 272,810
For a total investment of INR 240,000. The interest earned is INR 32,810, and the maturity value is INR 272,810.
What are the documents required to open an RD account in Kotak Bank?
For opening an RD account with Kotak bank, following is the list of documents required:
- Account opening form
- Recent passport size photograph
- KYC Documents
- For Company & Individual: PAN Card, Voter’s ID, Aadhar Card, Passport Copy, and Driving License
- HUFs: HUF declaration deed, self-attested PAN card, and HUF’s bank statement
- Partnership Firms: Certificate of Incorporation, Partnership deed, and ID proof of the partners.
However, to invest in a Kotak bank recurring deposit, one has to meet the eligibility criteria. Following is the eligibility criteria to invest in Kotak Bank Recurring Deposit is:
- Resident Individuals
- Non-Resident Indians (NRIs) and Persons of Indian Origin PIOs
- Sole proprietorship firms
- Trusts and companies
- Partnership Firms
- Public and Private Limited companies
Frequently Asked Questions
The highest interest rate on Kotak RD is 6.30% for a tenure of 24-33 months. For the same tenure, senior citizens are offered an additional 0.5%. Hence the highest Kotak RD interest rate for senior citizens is 6.8%.
Investment in Kotak Bank RDs does not qualify for tax saving under Section 80C of the Income Tax Act. Moreover, the interest income is taxable. The applicable tax rate is as per the individual’s income tax slab rates. Also, the interest income from Kotak RDs is subject to TDS of 10% if the interest income exceeds INR 40,000 (INR 50,000 for senior citizens). If the investor doesn’t submit PAN Card details, then the TDS rate will be 20%. Also, one can estimate their tax liability with Scripbox Income Tax Calculator.
Kotak Bank allows investors to withdraw their RD investment prematurely. If the investment is withdrawn in the first month of investment, the bank will not pay any interest. The bank will charge a penalty for investments withdrawn after one month has elapsed from the date of investment. The penalty is 0.5% on the interest of the RD.