How to withdraw money from recurring deposit before maturity?
Money withdrawal from your RD account is easy, and most RD providers allow either a partial, full or both online. However, I would not recommend withdrawing the RD amount as it incurs up to 1% penalty on your earned interest.
I recommend keeping the premature RD withdrawal as a last resort only if you are in financial distress. Now, to address your query about how to withdraw money from an RD account before maturity, here are some detailed steps:
- Open the mobile app or visit the web portal of your RD provider.
- Locate the savings section and choose Recurring Deposit (Location might vary between RD providers).
- Choose the amount to withdraw and submit. Your RD provider will deduct the applicable penalty and deposit the amount to your linked savings account.
You can also choose to do it offline. All you need to do is visit the branch of your RD provider during work hours:
- Request the bank official and obtain an RD withdrawal form.
- Fill it out with current account details, withdrawal amount, etc.
- Attach the required documents they ask for, sign the form and submit.
Another thing that I must add here is about tax implications. Taxes on Recurring Deposits are applicable. Therefore, if you withdraw early, the bank may deduct TDS, and thus you will face an early tax burden, which reduces your overall returns.