Savings Goal Calculator

Two questions, one calculator

Every savings plan is a version of one of two questions. How long will it take to reach my goal if I save a certain amount each month? Or how much must I save each month to reach my goal by a certain date? The calculator answers both. Enter your goal, what you have already saved, an optional interest rate and either the monthly amount or the years available.

Take a goal of $10,000 when you already have $2,000. Saving $300 a month with no interest takes 27 months. If the money earns 4 percent a year, it takes 26 months and the interest adds about $515. If you would rather set a deadline, reaching $10,000 in three years needs $202.86 a month at 4 percent, in two years $314.07, and in one year $647.87.

Why the deadline matters more than the interest rate

At the interest rates paid by most savings accounts, the amount you deposit does most of the work over short periods. In the example above, interest supplied about $515 of a $10,000 goal. Halving the time to reach a goal almost doubles the monthly amount, regardless of the rate. That is why a realistic timeline is the most important input: a plan that is too ambitious will be abandoned in a few months.

Over longer periods, interest matters more. That is where the Compound Interest Calculator is the better tool, since it shows the effect of growth across decades and of investing rather than saving.

Saving for common goals

Different goals have different time frames, and the time frame decides where the money should sit. Short goals want safe, accessible money; longer goals can accept some risk.

• Emergency fund (3 to 6 months of expenses). For a $15,000 target, saving $400 a month at 4 percent takes 36 months and earns about $873 of interest. Keep it in an easy-access savings account.
• Down payment on a home. $60,000 in five years from $5,000 today needs about $800 a month at 4.5 percent. Compare the total with the Mortgage Calculator to see the loan it supports.
• A holiday, wedding or car deposit. Under two years: use a savings account or short-term deposit, not shares.
• Debt-free date. If high-interest debt is the goal, use the Credit Card Payoff Calculator first, because paying off 18 percent debt beats any savings rate.

Make the plan stick

The best savings plans run without willpower. Set up an automatic transfer on payday so the money leaves before you can spend it. Give the goal a name and keep it in a separate account so it does not blur with everyday spending. Track progress monthly and compare it with the chart: a line that stays on the target path is encouraging, and a gap tells you early to adjust.

If you are behind, you have three levers: save more each month, extend the deadline, or reduce the goal. The calculator lets you test each one. If your income is irregular, base the plan on your lower months and add the extra in good months. The Salary Calculator can help translate an hourly rate into the monthly income you plan around.

Inflation and taxes

The calculator assumes a constant interest rate, deposits at the end of each month and no taxes. In reality, savings rates change, interest may be taxable and prices rise. A goal of $10,000 today may cost $11,000 or more in three years if the item you are saving for gets more expensive. For a long goal, adjust the target upwards with the Inflation Calculator. Leave the interest field blank for money that earns nothing, such as cash at home.

Reading the result

The three figures at the top are the time (or monthly amount), the total you deposit, including what you already have, and the interest earned. The chart shows the balance rising towards the goal line. If the goal is unreachable in 100 years at the amount you entered, the calculator says so rather than showing a nonsense date. Nothing you type is stored or sent anywhere; it all runs in your browser.