Consistency is the key – whether you are maintaining or improving your financial health. However, sticking to healthy financial habits can become challenging, if not today, then maybe later. You can cut your expenses, create budgets and stick to them but for how long? Some individuals manage to adhere to these habits, but others fail. It requires stern determination, which some of us might struggle with.

For such individuals, savings schemes such as recurring deposits and fixed deposits are the go-to options. They are designed with the same objective – to help individuals generate a sizeable savings corpus through investments and additional interest that helps their investment grow tenfold.If you are someone who has been planning to invest in these savings schemes, make sure you use an FD interest calculator and a recurring deposit calculator.These online tools are often confused with one another. Today, we will be discussing the basic differences as well as similarities between an FD interest calculator and a Recurring deposit calculator.But before we talk about that, let us take a moment to discuss recurring deposits and fixed deposits.

What is a Fixed Deposit?

A fixed deposit is a savings scheme that requires the investor to invest in a lump sum only one time. This invested amount earns a fixed interest rate every year all along the investment tenure. A fixed deposit provides an individual with the flexibility to choose their investment amount and investment tenure according to their financial preferences and objectives. The tenure for fixed deposit ranges between 7 days to 10 years. It is offered by numerous banks and financial institutions. Consequently, the interest rate provided by them differs from one another. You may use an FD interest calculator to get an estimate of the maturity amount.

What is a Recurring Deposit?

A recurring deposit is a savings scheme that requires the investor to make regular deposits. These deposits attract a fixed interest rate that supports wealth multiplication. This scheme is offered by post offices and leading banks in India. The tenure for this scheme ranges between 6 months to 10 years.

Differences Between Recurring Deposits and Fixed Deposits

Even though the objective of both savings schemes remains the same – multiplying wealth to help individuals save up for a secure financial future; they differ chiefly on the payment frequencies.

• While a fixed deposit invites a lump-sum deposit, a recurring deposit invites regular/ monthly deposits.
• The interest rates differ and vary according to the bank.
• There is no risk of default in FD as the deposit is one-time. RD, however, carries a risk of default.
• A fixed deposit also comes with an auto-renewal feature, whereas a recurring deposit does not.

Similarities and Differences Between an FD Interest Calculator and RD Calculator

Now that we have covered the basic differences between the two savings schemes let’s concentrate on the similarities and differences between an FD interest calculator and a recurring deposit calculator.

Similarities:

• Both the FD interest calculator and RD interest calculator calculate the amount payable to the investor on maturity.

• An FD interest calculator and Recurring deposit calculator compute results according to the compound interest formula. It is through the power of compounding that these savings schemes help multiply wealth.
• An FD interest calculator and RD calculator are available online across websites. These tools are easy to use and offer error-free results in a matter of clicks. They save individuals from the hassle of complex calculations.

Differences:

• The key difference between an FD interest calculator and a recurring deposit calculator lies in the purpose. Those investing in a fixed deposit must use an FD calculator, and those investing in a recurring deposit must use a Recurring deposit calculator.
• Some banks, finance and insurance companies provide a list of suggested plans when a visitor uses the FD interest calculator and RD calculator to estimate their returns.
• An FD interest calculator requires the input of a one-time investment amount, while recurring deposit calculators require the input of monthly investments.

The Bottom Line:

An FD interest calculator and RD calculator are the go-to tools if you are planning to invest in recurring deposits and fixed deposits. Use these tools now to make your calculations and financial planning easier than ever!

sooperarticles.com