Savings goal calculator

Work out how long it takes to reach a savings goal — or how much you need to save each month to get there. Real APYs, real compounding, no marketing nonsense.

How the math works

The calculator combines two formulas. Your current balance compounds on its own each month, and your monthly contributions form an ordinary annuity that also compounds.

Where FV is the future value (your target), PV is your current balance, PMT is the monthly contribution, i is the monthly rate (annual rate divided by 12), and t is the number of months. To find time to a goal, the calculator solves for t. To find the required monthly contribution, it rearranges and solves for PMT.

This assumes monthly compounding, which is the convention for most savings products. Daily-compounding accounts produce slightly higher returns over long horizons, but the difference is small at typical APYs — less than 2 cents on the dollar over 30 years at 4%.

Worked example

Take a household building a starter emergency fund of $9,600 — three months of essential expenses at $3,200/month. They start from $0, contribute $400/month, and put it in a high-yield savings account paying 4.00% APY.

Without interest, that's exactly 24 months. With 4% APY compounding monthly, the math comes in slightly under 24 months — call it 23. Total contributions: $9,200. Interest earned: $400.

Now run the same calculation with the money sitting in a checking account paying 0%. Same target, same contribution: 24 months. Same destination. The 4% APY shaved off less than a month.

That's the honest answer most savings calculators won't give you: on a two-year emergency fund, the interest rate barely matters. On a 20-year retirement target, it dominates everything. The horizon decides whether the rate matters.

When this calculator is wrong

The result above assumes a 4.00% APY, which is what online high-yield savings accounts currently pay. If your savings live in a checking account or the "savings" product at a brick-and-mortar bank, the actual rate is closer to 0.41% — the FDIC national average. The math above is wrong by roughly a factor of ten on the interest side.

Other ways this calculator misses:

• It assumes the contribution never changes. Most savers contribute more as their income grows, which means the calculator's prediction is often pessimistic over multi-year horizons.
• It ignores inflation. A $10,000 goal hit in five years is worth less, in real terms, than $10,000 today. For short horizons this doesn't matter much; for retirement goals it dominates everything.
• It assumes constant APY. Real rates move. If the Fed cuts rates next quarter, your high-yield account will too.
• It treats taxes as zero. Interest in a regular savings account is taxed as ordinary income. At a 22% marginal bracket, a 4% APY is really closer to 3.1% after tax. (Doesn't apply inside a Roth IRA, HSA, or 529.)

What to do with the result

If the calculator says you'll hit your goal in a reasonable timeframe, the next step is making sure the money is actually somewhere paying the rate you're modeling. Most savers leave money in a low-rate account out of inertia. The biggest single move available to a typical saver is moving from a 0.41% account to a 4%+ one — that's not a rate optimisation, that's the whole game.

If the calculator says your goal is more than a few years out and the rate matters, you're probably looking at the wrong product. Savings accounts are for short-horizon money. For anything longer than three years, the math points toward an index fund — but that's a different calculator.

Common questions

What's the difference between APY and APR?

APY (annual percentage yield) accounts for compounding. APR (annual percentage rate) doesn't. For savings, you want APY — it's the actual return. The two are close at low rates and diverge at high ones.

Should I use this calculator's result as a hard target?

No. Use it as a baseline. Real-life income changes, tax effects, and rate changes will shift the actual timeline. If the calculator says 23 months, plan for 24–28 and you'll usually beat the plan.

Does it matter if I save weekly versus monthly?

Almost never. The compounding advantage of weekly over monthly contributions, at typical rates, is in the tens of dollars over multi-year horizons. Pick whichever cadence you'll actually maintain.

What rate should I assume for long-horizon goals?

For cash in a high-yield savings account, model 3.5–4.5% today. For money in a broad-market index fund, the long-run real return has averaged about 7% — but that's volatile and short-horizon money should not be there.