Breaking a goal into a regular deposit makes it achievable. Automating the deposit right after payday is the easiest way to stick with it.
How to use the Savings Goal Calculator
- Savings goal
- Current savings
- Time to reach the goal
- Annual interest rate
- Compounding frequency
- Deposit frequency
- Deposits made at
- Yearly increase of deposits
Results update as you type, and every field accepts the units shown in its menu.
How it works
Enter your goal, current savings, the time to reach the goal, interest rate, compounding, deposit frequency, timing and yearly deposit increase.
Tips
- Use your real spending from bank statements rather than guesses.
- Automate savings so they happen before you spend.
- Revisit your plan once a year or after any big life change.
- Keep an emergency fund before investing for long-term goals.
Common mistakes to avoid
- Underestimating irregular expenses such as car repairs, gifts and annual bills.
- Ignoring inflation for long-term goals.
- Taking on high-interest debt to fund wants.
Inputs explained
| Field | What to enter |
|---|---|
| Savings goal | Amount in your currency |
| Current savings | Amount in your currency |
| Time to reach the goal | Units: years, months |
| Annual interest rate | In % |
| Compounding frequency | Choose one: Yearly, Semi-annually, Quarterly, Monthly … |
| Deposit frequency | Choose one: Monthly, Semi-monthly, Bi-weekly, Weekly … |
| Deposits made at | Choose one: End of each period, Beginning of each period |
| Yearly increase of deposits | In % |
What each result means
- Number of deposits = round([Time to reach the goal]×[Deposit frequency])
- Required deposit (first) = max(([Savings goal] – [Current savings]×(1 + effr([Annual interest rate]÷100, [Compounding frequency]))^[Time to reach the goal])÷gfv([Rate per period], [Number of deposits], 1, [Growth per period], [Deposits made at]), 0)
- Interest earned = [Savings goal] – [Total deposits]
Example values
How the main result changes when Savings goal changes and everything else stays at the example values above:
| Savings goal | Required deposit (first) |
|---|---|
| 12,500 | 265.47 |
| 18,750 | 427.95 |
| 25,000 | 590.43 |
| 31,250 | 752.91 |
| 37,500 | 915.39 |
| 50,000 | 1,240.35 |
Formula
Rate per period i = (1 + r ÷ m)^(m ÷ f) − 1, n = years × fRequired deposit = (goal − P(1 + i)^n) × (i − g) ÷ (((1 + i)^n − (1 + g)^n)(1 + i × timing))Worked example
Inputs — Savings goal: $25,000; Current savings: $2,000; Time to reach the goal: 3 years; Annual interest rate: 4.5 %; Compounding frequency: Monthly; Deposit frequency: Monthly; Deposits made at: End of each period; Yearly increase of deposits: 0 %.
Results — Number of deposits = 36; Required deposit (first) = $590.43; Total deposits = $23,255.45; Interest earned = $1,744.55.
Frequently asked questions
How much should I save each month for my goal?
(Goal − savings with interest) spread over the months available.
Where should I keep money for a short-term goal?
In a high-yield savings account or CDs.
What if I can't afford the required deposit?
Extend the deadline, lower the goal or raise income.
What formula does the Savings Goal Calculator use?
Rate per period i = (1 + r ÷ m)^(m ÷ f) − 1, n = years × f.