Recurring Deposit

Meaning :

A Recurring Deposit (RD) is a savings product where a fixed amount of money is deposited every month for a chosen period, earning guaranteed interest. It helps

people save regularly and is great for those who prefer to save small amounts each  month instead of a big lump sum.

Example : 

For instance, depositing ₹1,000 every month in an RD for 2 years helps build disciplined savings.

How to Understand : 

Think of an RD as a savings plan where you "save a small amount regularly."

It encourages discipline because the same amount is deposited each month.

Over time, these small deposits grow into a larger amount with interest.

Importance :

RDs help build long-term savings for future needs.

They are perfect for beginners, students, and salaried individuals who want to save regularly.

RDs are low-risk investments with fixed guaranteed returns.

They encourage regular financial discipline by making saving a habit.