How the savings goal calculator works
First it grows what you have already saved at the rate you expect until your deadline. Whatever is still missing from your goal has to come from monthly deposits, and the calculator solves for the deposit using the future value of an annuity formula: PMT = FV × i / ((1+i)n − 1), where i is the monthly rate and n the number of months.
Choosing a realistic return
Money you need within a few years, such as a house deposit or emergency fund, usually belongs in low-risk places like high-yield savings accounts or CDs, so use that account's rate. For goals ten or more years away, people often model a higher expected return, but a higher assumed return also means more risk of falling short.
Tips to reach your goal
- Automate the transfer on payday so saving happens before spending.
- Keep goal money in a separate account so it is harder to dip into.
- Increase your deposit whenever you get a raise.
- If the monthly figure is too high, extend the deadline and see how much it drops.
Frequently asked questions
How much should I save each month?
It depends on your goal and deadline. Enter both above to see the exact monthly amount. A common starting target for an emergency fund is three to six months of expenses.
What if I do not earn any interest?
Set the return to 0%. The calculator then simply divides the remaining amount by the number of months.
Is the interest rate guaranteed?
Only for fixed products such as CDs. Savings account rates can change and investment returns are not guaranteed.
Does it account for inflation?
No. If you want a result in today's money, enter a return that is reduced by expected inflation.