Savings Calculator
Calculate how your savings will grow with compound interest and regular monthly contributions.
Savings Summary
Calculations assume consistent contributions and compound interest over the specified period.
| Year | Contributions | Interest Earned | Ending Balance |
|---|
Scenario A
Scenario B
Understanding Compound Interest Savings
💰 How Compound Interest Works
Compound interest means you earn interest on your interest. If you have $1,000 at 5% annual interest, you earn $50 in year one. In year two, you earn 5% on $1,050, which is $52.50. This compounding effect accelerates growth over time.
Key point: The longer your money compounds, the more dramatic the growth becomes.
📅 Regular Contributions Matter
Consistent monthly contributions significantly boost your savings. Even small amounts add up—saving $200/month at 5% for 20 years yields over $82,000, with $34,000 from interest alone.
Pro tip: Automate your savings to ensure consistent contributions without relying on willpower.
📈 Compounding Frequency Impact
More frequent compounding increases returns slightly. On $10,000 at 5% for 10 years:
- Annual: $16,289
- Quarterly: $16,436
- Monthly: $16,470
- Daily: $16,487
🎯 Savings Strategies
- Start early—time is your biggest advantage
- Use high-yield savings accounts (4-5% vs 0.1%)
- Increase contributions annually with raises
- Build an emergency fund (3-6 months expenses)
- Consider tax-advantaged accounts (401k, IRA)
Frequently Asked Questions
How is compound interest calculated on savings?
Compound interest is calculated using the formula A = P(1 + r/n)^(nt), where P is the principal, r is the annual rate, n is the compounding frequency, and t is time in years. With regular contributions, each deposit also earns compound interest.
How much should I save per month?
A common guideline is the 50/30/20 rule: save 20% of your income. For someone earning $50,000 annually, that's about $833/month. Adjust based on your goals, expenses, and timeline.
What is a good savings interest rate?
As of 2025, high-yield savings accounts offer 4-5% APY, while traditional savings accounts offer 0.1-0.5%. Money market accounts and CDs may offer higher rates for longer commitments.
How does monthly vs annual compounding affect savings?
More frequent compounding increases returns. On a $10,000 balance at 5% for 10 years: annual compounding yields $16,289, while monthly compounding yields $16,470—a difference of $181.
How to Use the Savings Calculator
View instructions
- Enter your starting savings amount in the initial deposit field
- Add your planned monthly contribution to see how regular savings grow
- Adjust the interest rate to match your savings account or investment
- Change the time period to see short-term or long-term growth projections
- Use advanced options to customize contribution frequency and compounding
Frequently Asked Questions
View FAQs
How does a savings calculator work?
A savings calculator uses compound interest formulas to project how your money grows over time. It factors in your starting balance, regular contributions, interest rate, and time period to show your final balance, total contributions, and interest earned.
Does this calculator use compound interest?
Yes, this calculator uses compound interest, meaning you earn interest on both your principal and accumulated interest. You can choose monthly, quarterly, or annual compounding in the advanced options to match your savings account.
Can I change how often I contribute?
Yes, in the advanced options section you can select monthly, bi-weekly, or weekly contributions. You can also set annual increases to your contributions and add a start delay if you're planning to begin saving in the future.
Is this savings calculator free to use?
Yes, this savings calculator is completely free with no registration required. All calculations happen in your browser with no data sent to our servers. You can use it as many times as needed to plan your savings goals.
Related Calculators
Investment Calculator
Estimate long-term growth from investments and compound returns.
Loan Calculator
Calculate monthly loan payments and total interest over time.
Credit Card Payoff Calculator
See how long it will take to pay off credit card debt.
Auto Loan Calculator
Estimate car payments, interest costs, and payoff timelines.