Rs 10,000 monthly RD for 10 years: Post Office or SBI—which gives the bigger maturity amount?

Recurring deposits (RDs) are among the most popular investment options for conservative investors because they offer fixed returns that are not affected by market fluctuations. By investing a fixed amount every month, investors can build a sizeable corpus over time while enjoying predictable returns.

If you invest Rs 10,000 every month for 10 years, both Post Office RD and SBI RD can help you accumulate a substantial amount. However, the final maturity value depends on the interest rate offered by each scheme. Here's a comparison of the maturity amounts offered by Post Office RD and SBI RD for the same investment and tenure.

Post Office RD vs SBI RD: Rs 10,000 monthly investment for 10 years

For this comparison, we have assumed a monthly investment of Rs 10,000 for 10 years.

The total investment in both cases is Rs 12,00,000. However, the interest earned and maturity amount differ because of the difference in interest rates offered by Post Office RD and SBI RD.

Post Office RD vs SBI RD: Maturity amount comparison

Monthly investment: Rs 10,000

Investment period: 10 years

Total investment: Rs 12,00,000

Post Office RD

• Interest rate: 6.7 per cent per annum
• Interest earned: Rs 5,08,546
• Maturity amount: Rs 17,08,546

SBI RD

• Interest rate: 6.05 per cent per annum
• Interest earned: Rs 4,48,781
• Maturity amount: Rs 16,48,781

Which RD gives a higher maturity amount?

Based on the current interest rates, the Post Office RD delivers a maturity amount of approximately Rs 17.09 lakh, while the SBI RD generates around Rs 16.49 lakh on the same monthly investment of Rs 10,000 for 10 years.

This means an investor can earn nearly Rs 59,765 more by choosing a Post Office RD over an SBI RD for the same investment period.

These calculations are based on the prevailing interest rates. Actual returns may vary if either the Post Office or SBI revises its RD rates in the future.

What is a recurring deposit account?

A recurring deposit account allows individuals to deposit a fixed amount every month for a predetermined period. Interest is paid at a fixed rate, making returns predictable and helping investors develop a disciplined savings habit.

Benefits of investing in an RD

Recurring deposits are popular among investors who want predictable returns and low risk. Since RD interest rates are fixed at the time of investment, returns are not affected by market volatility. RDs can also help individuals develop a disciplined savings habit by encouraging regular monthly investments towards long-term financial goals.

Key features of Post Office RD

A Post Office RD account can be opened with a minimum monthly deposit of Rs 100, and there is no maximum investment limit.

Premature closure is allowed after three years from the date of opening. If the account is closed before completing the tenure, the applicable interest may be lower as per the scheme rules.

Key features of SBI RD

SBI allows customers to open an RD account with a minimum monthly deposit of Rs 100.

If six consecutive instalments are missed, the RD account may be closed prematurely and the balance amount paid to the depositor.

SBI RD penalty for delayed instalments

For RD accounts with a tenure of up to five years, SBI charges a penalty of Rs 1.50 per Rs 100 deposit per month for delayed instalments.

For RD accounts with a tenure of more than five years, the penalty is Rs 2 per Rs 100 deposit per month. However, the total penalty cannot exceed the interest earned on the RD account.