Savings Goal Calculator

Set the amount you are saving toward, what you already have, how many years you can give it, and the annual rate the money earns. The calculator returns the deposit needed at the end of each month, plus the split between your own contributions and interest growth. Results update as you type. Read the primary figure as the discipline the goal demands: hit it every month and the target arrives on schedule; miss it and either the deadline slips or the final number falls short.

The sinking fund and its arithmetic

Setting aside a fixed amount on a schedule so it compounds up to a known target has a formal name that long predates any spreadsheet: the sinking fund. The mechanism appears in the commercial tax syndicates of the Italian peninsula in the fourteenth century, where cities pledged a stream of revenue to a fund meant to retire their public debt. It entered British public finance when Robert Walpole established a national sinking fund in 1716 to chip away at the debt left by decades of war. The fund did real work in the 1720s and early 1730s, but successive governments raided it whenever a more pressing bill arrived.

The concept found its most enthusiastic champion in Richard Price, the Welsh nonconformist minister and mathematician, whose 1772 pamphlet An Appeal to the Public on the Subject of the National Debt argued that a modest sum left to grow at compound interest could extinguish even an enormous debt given enough time. William Pitt the Younger acted on that argument and reformed the sinking fund in 1786, ring-fencing it against ministers who might dip in and committing a fixed one million pounds a year to repayment under a body still in existence, the Commissioners for the Reduction of the National Debt. For a while it worked: between 1786 and 1793 the commissioners took in around eight million pounds and reinvested it to pay down the national debt by more than ten million, before the French Revolutionary Wars overwhelmed the plan. Price's confidence in compound interest turned out to be overstated, since a fund topped up with freshly borrowed money saves a government nothing, but the arithmetic he trusted is exactly what this tool runs in reverse.

That arithmetic rests on compound interest tables with a long pedigree. A Babylonian clay tablet from roughly 2000 to 1700 BC poses what is now read as the first compound interest problem. The Florentine merchant Francesco Balducci Pegolotti tabulated such calculations around 1340 in his Pratica della mercatura, and Richard Witt's Arithmeticall Questions of 1613 was the first book devoted entirely to the subject, running to 124 worked examples. Jacob Bernoulli, probing what happens as interest is compounded ever more often, discovered the constant e in 1683. Engineers and actuaries still call the multiplier that turns a target sum into the equal deposit needed to reach it the sinking fund factor, and that factor is precisely what this page solves for.

How the monthly figure is worked out

The deposit comes from rearranging the future value of an ordinary annuity — the same time-value-of-money relationship behind the PMT function in Excel and Google Sheets. With i as the monthly rate (annual rate divided by 1,200) and n as the number of months:

PMT = (FV − PV(1 + i)ⁿ) × i ÷ ((1 + i)ⁿ − 1)

Here FV is the target and PV is what you have now. The problem splits cleanly in two: the PV(1 + i)ⁿ term is what your existing balance grows into on its own, and the deposits cover whatever gap is left. The trailing fraction, i ÷ ((1 + i)ⁿ − 1), is the sinking fund factor itself: multiply the gap by it and you get the level payment. When the rate is exactly zero the formula collapses to the gap divided by the number of months, because without growth every deposit is worth its face value and nothing more.

Run it on the defaults: a 20,000 target, 2,500 saved, four years at 3.5%. The monthly rate is 3.5 ÷ 1,200 = 0.0029167, and over 48 months the growth factor is 1.0029167⁴⁸ = 1.1500394. Your 2,500 becomes 2,875.10 untouched, leaving a 17,124.90 gap, and the formula turns that into 332.90 a month. You end up contributing 15,979.04 of the 17,500 you needed; interest covers the remaining 1,520.96. The earliest deposits do most of the compounding, which is why starting sooner beats topping up later even when the monthly amount is identical.

What a better rate buys you

Same goal, same four years, different accounts:

Moving from a 0% current account to 3.5% saves about 32 a month. Real money, but over short horizons the timeline does far more work than the rate does.

Assumptions worth knowing

Deposits land at month end, the rate stays fixed for the whole period, and tax and fees are ignored. Month-end timing is the ordinary annuity convention that the sinking fund factor assumes and that spreadsheet PMT functions default to; paying at the start of each month instead would earn one extra month of interest on every deposit and trim the required amount slightly. The fixed-rate assumption is fair for cash savings but not for investments: market returns arrive unevenly, and the order they arrive in matters. A portfolio averaging 5% can still leave you short if the weak years come late, when the balance is largest. Two edge behaviors are deliberate — a balance already at the target returns zeros, and so does one that would compound past it on its own, since no deposits are needed.

Where goal money tends to live

In the US that is usually a high-yield savings account, with FDIC cover of 250,000 dollars per depositor, per insured bank, per ownership category. UK savers can shelter interest inside a cash ISA and are protected by the FSCS, whose deposit limit rose from 85,000 to 120,000 pounds per person per firm on 1 December 2025. Eurozone deposits carry a 100,000 euro guarantee set by the EU deposit guarantee schemes directive, 2014/49/EU, though rates differ sharply by country. Canadians often route goal savings through a TFSA so the growth stays untaxed, and Australian bonus-rate savers frequently require a minimum monthly deposit — a condition a fixed monthly plan satisfies naturally.

These projections assume a constant rate and are estimates, not guarantees — actual returns, taxes and fees will shift the numbers. See the site disclaimer.

Frequently asked questions

How much do I need to save a month to reach 20,000 in 4 years?

Starting from 2,500 at 3.5% compounded monthly, about 332.90 a month. With no interest at all it would be 364.58, so the rate covers roughly 32 a month of the work. Halve the timeline to two years and the figure jumps to about 697.71.

Are the deposits assumed at the start or the end of each month?

The end, which is the ordinary annuity convention that spreadsheet PMT functions also default to. Depositing at the start of the month instead trims the required amount by one month of interest — about 0.97 off 332.90 at 3.5%. Over four years that difference adds up to less than 50.

What interest rate should I enter in a savings calculator?

The annual rate the money will actually earn: the APY on a US high-yield savings account, the AER on a UK easy-access account, or your expected return if the goal money is invested. Competitive cash accounts have recently paid in the 3–5% range across most major markets, while big-bank default accounts often pay under 1%.

Why does the monthly amount show zero?

If your current balance already meets or beats the target, or would grow past it on its own before the deadline, no further saving is needed and all three results read zero. Lower the balance below the target, or raise the target, and the monthly figure comes back.

Does monthly compounding match how my bank pays interest?

Closely enough. Many US and Canadian accounts compound daily and credit monthly, while UK accounts often quote an annual AER. At 3.5% the gap between daily and monthly compounding moves the required deposit by only a few cents a month, well inside the rounding on your statement.