Calculator
Savings growth calculator
This shows what a savings balance could grow to if you add the same amount every month and earn a steady yearly rate. You type the rate yourself, because rates change and differ by account. Put a different rate in the second box to see how much a small difference matters over time. Nothing you type leaves your device.
Worked example (shown when scripts are off): $1,000 at a 12 percent yearly rate, with nothing added, for one year. The monthly rate is 12 / 12 = 1 percent. After 12 months the balance is 1,000 x 1.01 to the 12th power, which is about $1,126.83, so about $126.83 is interest. The 12 percent is only there to keep the arithmetic easy to check.
Before you rely on this
Real accounts can change their rate at any time, may compound or pay interest on a different schedule, and may charge fees. Interest can be taxable. This is general information to help you compare scenarios, not advice. For decisions about your own money, a licensed financial adviser or tax professional can look at your whole situation.
The formula
The calculator uses monthly compounding with each deposit made at the end of the month. Let i be the yearly rate divided by 100 and then by 12, and let n be the number of months (years x 12). The balance is:
balance = start x (1 + i)^n + deposit x ((1 + i)^n - 1) / i
If the rate is zero, there is no growth and the formula becomes start + deposit x n. The amount you put in is start + deposit x n, and the interest earned is the balance minus that amount. The year-by-year table applies the same formula at month 12, 24 and so on.
How to use it
Start with what you can really afford to deposit each month, not what feels ideal. Then use Rate A for the rate your account states and Rate B for a lower or higher figure. Comparing the two answers shows whether a rate difference is worth the effort of moving money. Often the monthly deposit matters more than the rate, especially in the first few years, because interest has little to work with while the balance is small. Try raising the deposit by a small amount and watch the result.
What the rate means
Banks quote a yearly rate called the annual percentage yield, or APY, under the federal Truth in Savings rules, so that accounts can be compared on the same basis. APY already includes the effect of compounding. This calculator takes a nominal yearly rate and compounds it monthly, so if you type an account's APY the answer will run a little high, and if you type a nominal rate it will match monthly compounding. Treat the output as an estimate either way, and read the account's own disclosure for the exact method.
Limits
- The rate is held constant for the whole period. Savings rates usually move.
- Deposits are assumed to arrive on time every month, and no money is withdrawn.
- Fees, taxes and inflation are not included. Inflation reduces what a balance can buy, so a higher number later is worth less than the same number today.
- Results are rounded to the cent and are estimates, not a promise from any bank.
Where this comes from
The balance formula is the standard compound interest and future value of an ordinary annuity formula taught in introductory finance. We checked the description of APY and the Truth in Savings requirement against the Consumer Financial Protection Bureau's explanation. The calculator was tested against a month-by-month loop for 400 combinations of amounts, years and rates, and against hand-calculated values such as the worked example above.