Savings Goal Calculator

There are two ways to look at a savings target. Either you know how much you can put aside and want to know when you'll get there, or you have a deadline and want to know how much to save. This calculator does both, including interest at the return you choose, and it tells you straight away if you've already reached the goal.

How to use it

1. Pick whether you want the time needed or the monthly amount.
2. Enter the goal, what you've saved so far, and the yearly return you expect.
3. Add your monthly saving, or the number of years you have.
4. Read the result.

When it helps

• Saving for a house deposit, a wedding or a car.
• Deciding how much to move into savings each payday.
• Seeing how interest shortens the road.
• Checking whether a deadline is realistic.

Good to know

• Set the return to 0 if your money sits in a plain account that earns nothing.
• A modest rise in the monthly amount can cut the time by months.
• Interest is compounded monthly, and the rate is assumed steady.

The calculations

To find the time needed, the tool simulates month by month: add interest to the balance, then add your deposit, until the goal is reached. To find the monthly amount, it uses the future value of an annuity formula, which solves for the deposit that grows, with your starting amount, into the goal.

Interest is compounded monthly using the monthly equivalent of your yearly return.

Worked example: a house deposit

You want 10,000 in three years and have 1,000. At 4 percent a year you need about 233 a month. At 0 percent you'd need 250 a month, so interest saves you a bit. Increase the term to four years and the monthly amount drops to about 170.

Seeing the trade-off helps you choose between saving harder and waiting longer.

Making saving automatic

The most reliable way to hit a goal is to automate it: set up a standing order on payday into a separate account. Treat it like a bill. Name the account after the goal, which makes it harder to dip into.

If you get a pay rise or a bonus, put part of it toward the goal. Small, regular increases make a big difference.

Where to keep your savings

For short-term goals, use accounts that protect your money, such as savings accounts or money market funds, even if returns are lower. For long-term goals, you might accept more risk for higher expected returns.

Set the return in the calculator to a cautious figure, and be sure you understand any fees, tax and access limits.

Revisiting your plan

Check in every few months. If you are ahead of schedule, you can lower your monthly amount or bring the date forward. If you've fallen behind, adjust the deposit or the deadline instead of giving up.

Questions