Savings Goal Calculator
The monthly amount needed is the goal minus the grown starting balance, divided by the monthly annuity growth factor.
Worked example
| Savings goal | $50,000 |
|---|---|
| Initial deposit | $5,000 |
| Years to save | 10 |
| Estimated annual rate | 5% |
| Monthly Contribution Needed | $268.96 |
| Total Contributions | $37,275 |
| Total Interest Earned | $12,725 |
How it is calculated
The starting deposit grows by (1 + rate/12)^months. The gap between the goal and that value must come from monthly deposits.
Monthly deposit = gap / (((1 + rate/12)^months - 1) / (rate/12)). If the starting deposit alone already reaches the goal, the result is 0.
Assumptions and limits
- Assumes a constant rate and deposits at the end of every month.
- Requires a rate above 0%; taxes and inflation are not modelled.
Educational estimate only; not financial, tax, legal or investment advice.
FAQ
How much should I save each month to reach my goal?
It depends on goal, time, starting balance and rate. To reach $50,000 in 10 years from $5,000 at 5%, deposit about $268.96 a month.
How much of the goal comes from interest?
In the example, interest provides about $12,725 and your contributions $37,275.
What if my starting balance already covers the goal?
The calculator then shows a required monthly contribution of 0.