Savings Calculator

Calculate savings growth, future account balances, compound interest earnings, and long-term financial goals.

Savings Calculator

Project how a savings balance grows over time from an initial deposit, regular contributions, and compound interest. The result shows the future balance, how much of it came from your deposits, and how much was earned as interest.

Savings growth formula

With monthly compounding and a deposit made at the end of each month, the future value combines two parts:

FV = P × (1 + i)^n + PMT × ((1 + i)^n − 1) / i

  • P is the starting balance.
  • PMT is the regular monthly deposit.
  • i is the monthly interest rate, the annual rate divided by 12.
  • n is the number of months.

The first term is the initial deposit growing on its own; the second is the accumulated value of the stream of monthly deposits. Because interest is credited on previously earned interest, growth accelerates over time — the effect people mean by compounding.

Worked example

Suppose you start with 5,000, add 200 per month, and earn 5% per year compounded monthly for 10 years.

  • Monthly rate: i = 0.05 / 12 ≈ 0.004167, and n = 120
  • Growth factor: (1.004167)^120 ≈ 1.6470
  • Initial deposit grows to: 5,000 × 1.6470 ≈ 8,235
  • Monthly deposits grow to: 200 × (0.6470 / 0.004167) ≈ 31,056

The projected balance is about 39,291. You deposited 5,000 + 200 × 120 = 29,000, so roughly 10,291 of the final balance is interest.

When to use this calculator

  • Setting a goal, such as an emergency fund or a large purchase, and testing how long it takes to reach it at your current deposit rate.
  • Comparing accounts, to see how a difference in interest rate changes the outcome over several years.
  • Deciding how much to save monthly, by adjusting the deposit until the projection meets your target date.
  • Showing a saver the value of starting early, since the same monthly deposit produces markedly more when given extra years to compound.

Tips for interpreting the result

  • Check how often your account actually compounds and credits interest; monthly, quarterly, and annual compounding give slightly different results at the same quoted rate.
  • Savings rates are usually variable, so treat long projections as scenarios rather than promises and revisit them when rates change.
  • Inflation erodes purchasing power; a projection in today's money requires using a rate net of expected inflation.
  • Interest earned may be taxable depending on where you live and the account type, which lowers the effective return.
  • Small, consistent increases to the monthly deposit often matter more to the final balance than chasing a slightly higher rate.

Related calculators

The lump sum calculator projects a one-off deposit without regular contributions, and the retirement calculator extends the same mechanics to long-term retirement planning. The debt-to-income calculator helps judge how much room your budget has for saving, the rent vs buy calculator compares housing choices that affect it, and the VAT/GST calculator handles everyday price and tax arithmetic.

Projections are estimates based on the inputs you provide; confirm current rates, terms, and tax treatment with your bank or a qualified adviser before making significant decisions.

Frequently asked questions

How does compound interest grow my savings?
Interest is credited not only on your deposits but also on the interest already earned, so the balance grows faster the longer it is left. For example, 5,000 plus 200 per month at 5% compounded monthly grows to about 39,291 in 10 years, of which roughly 10,291 is interest. The effect is small at first and accelerates over time.
What formula does the savings projection use?
It combines FV = P × (1 + i)^n for the starting balance with FV = PMT × ((1 + i)^n − 1) / i for the stream of monthly deposits, where i is the monthly rate and n the number of months. This assumes deposits at the end of each month and monthly compounding.
Does the compounding frequency matter?
Yes, though the effect is modest at typical savings rates. The same quoted annual rate produces a slightly higher balance when compounded monthly than annually, because interest starts earning interest sooner. Check whether your account credits interest monthly, quarterly, or annually and match the calculator to it.
Should I account for inflation in a savings projection?
For goals more than a few years away, yes. A nominal projection shows the future account balance, but inflation reduces what that balance will buy. To see the result in today's purchasing power, use a rate roughly equal to your interest rate minus expected inflation.
Is interest on savings taxable?
In many countries interest income is taxable, though tax-advantaged account types and allowances often exist. Tax reduces your effective return, so a projection using the gross rate can overstate the outcome. Check the rules for your account type with your tax authority or an adviser.
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