ConverterHub

Savings Goal Calculator

How much should I save each month?

How it is calculated

The tool finds the monthly deposit that reaches a target with compound interest. The annual rate is divided by 12: r = rate / 100 / 12, and the growth factor is g = (1 + r)n for n months. Your current balance grows alone to current × g. What remains is goal − current × g, and the monthly deposit is PMT = remaining × r / (g − 1). Deposits are assumed at the end of each month, with interest compounded monthly. At a 0% rate the remaining amount is simply split over the months. If the current balance already grows to the goal, the tool says the goal is reached. It also shows total contributions and the interest earned. Fractions of months are cut off, and taxes and inflation are ignored.

Worked example

The goal is 12,000, the current savings are 2,000, the annual rate is 6% and the time frame is 24 months. The monthly rate is 0.5% (r = 0.005) and the growth factor is 1.00524 ≈ 1.1272. The 2,000 already saved will grow to about 2,254.32, leaving 9,745.68 to be filled. The deposit is 9,745.68 × 0.005 / 0.1272 ≈ $383.21 per month. Contributions in total are 2,000 + 24 × 383.21 = $11,196.95, and the interest earned makes up the remaining $803.05.

Try this example →

Common mistakes

  • Entering the time frame in years. The field is in months, so 2 years must be entered as 24.
  • Using a rate from a savings account that is quoted with a different compounding or after tax; the tool assumes simple monthly compounding of the annual rate you give.
  • Ignoring inflation: the nominal goal buys less in the future, so the target may need to be larger.
  • Expecting the result to include the first deposit today. Here the first payment is made at the end of month one.

About this calculator

This calculator works out how much needs to be set aside on a regular basis to reach a specific savings target within a chosen number of months, taking into account whatever you have saved already and any interest the balance might earn along the way. Because that starting balance grows too, and interest reduces how much of the target has to come from contributions alone, the required deposit amount is usually smaller than a simple division of the goal by the number of periods.

People use it when saving toward a concrete goal with a deadline, such as a vacation, a wedding, a down payment, or a big purchase, since it turns a vague goal into a specific monthly amount to set aside. It's also useful for checking whether a current savings pace is actually on track over the months available.

Was this helpful?

You can pick up to 3 reactions.

Comments (0)

  • Be the first to comment.

Popular calculators

Loan Calculator

Monthly payment, total interest and full amortization schedule.

Percentage Calculator

Percent change, percent of, and ratio calculations.

Discount Calculator

Calculate final price, savings, and discount amount.

BMI Calculator

Body mass index from height and weight (metric or imperial).

Age Calculator

Compute your exact age in years, months and days from a birth date.

Compound Interest Calculator

Calculate the final amount and interest earned with compounding.

All Calculators