Two ways to plan a savings goal
This calculator answers the two questions people most often ask about saving. First, if I keep saving what I save now, how long will it take to reach my goal? Second, how much do I need to save each month to get there by a specific date? Enter your goal, what you already have, your monthly deposit, the interest rate and a target time frame, and both answers appear instantly.
Time to goal is found by stepping month by month: the balance earns one month of interest and then your deposit is added, until the balance reaches the goal. The monthly amount needed uses the future value of an annuity formula: deposit = (goal − current × (1 + r)^n) × r ÷ ((1 + r)^n − 1), where r is the monthly rate and n the number of months.
A worked example
Say you want $25,000 for a home down payment. You have $2,000 saved, can put away $400 a month, and your high-yield savings account pays 4.5%. The calculator shows it will take about 4 years and 4 months. If you want to get there in 3 years instead, you need to save about $590 a month. At 0% interest it would take 58 months, so interest shaves roughly half a year off the plan.
Where to keep short-term savings
For goals less than about five years away, safety usually matters more than returns, because you cannot afford a market drop just before you need the money. High-yield savings accounts, money market accounts, certificates of deposit and short-term government bonds are common choices. In the US, bank deposits are insured by the FDIC and credit union deposits by the NCUA up to $250,000 per depositor per institution. Interest rates on savings accounts change with central bank rates, so revisit your plan if your rate moves. For longer-term goals such as retirement, see the retirement and compound interest calculators.
Tips to reach your goal faster
Automate your savings by scheduling a transfer on payday so the money moves before you can spend it. Give each goal its own account or bucket so progress is visible. Put windfalls such as tax refunds, bonuses and gifts toward the goal. Review subscriptions and recurring bills; cutting $50 a month adds $600 a year. Build a basic emergency fund of three to six months of essential expenses before or alongside other goals, so an unexpected bill does not force you to dip into savings or take on debt. Small increases help too: raising your deposit by just $25 a month whenever you get a raise compounds into a meaningful difference.
Frequently asked questions
How long will it take to save $10,000?
Saving $400 a month with no interest takes 25 months. At 4.5% interest it takes 24 months. Enter your own numbers above for an exact answer.
How much should I save each month?
A common rule is to save at least 20% of take-home pay across all goals, but the right amount depends on your goals and timeline.
Does the calculator include taxes on interest?
No. Interest in a regular savings account is usually taxable, which slightly reduces your real growth.
What interest rate should I use?
Use the APY your bank currently offers. For a conservative plan, use a slightly lower rate in case rates fall.