Savings Calculator

At 5% APY with monthly compounding. Higher rates (S&P 500 avg 7–10%) grow significantly faster. Use the calculator above for your exact rate.

How does compound interest work in a savings calculator?

Compound interest means you earn interest on both your original deposit and previously earned interest. Monthly compounding: each month, your balance is multiplied by (1 + annual rate ÷ 12). On $10,000 at 5% for 10 years with $500/month added, you'd accumulate approximately $87,000 — of which $27,000 is interest you earned without contributing a single extra dollar.

How much will $500/month savings grow to in 10 years?

Saving $500/month for 10 years at 5% APY grows to approximately $77,600 ($60,000 contributed + $17,600 in compound interest). At 8% (S&P 500 average), it grows to $91,500 ($31,500 in interest). At 10%, approximately $103,000. Starting earlier dramatically increases the interest portion — the same $500/month for 20 years at 7% grows to $260,000.

What is a realistic interest rate to use in 2026?

High-yield savings accounts (HYSA) in 2026 offer 4–5% APY with FDIC insurance — use 4.5% for HYSA planning. US Treasury bonds average 3–5%. The S&P 500 long-term average is 7–10% (use 7% for conservative projections, 10% for optimistic). For retirement accounts (401k, IRA), 7–8% is a commonly used planning rate. The calculator lets you test any rate.

How much should I save per month for retirement?

The 15% rule: save 15% of gross income for retirement starting in your 20s. At $60,000 salary, that's $750/month. If starting later, you need more: starting at 35 instead of 25 requires roughly double the monthly savings to reach the same goal. Our calculator shows exactly how much monthly savings you need to hit any target by any date.

What is the Rule of 72 and how does it apply to savings?

The Rule of 72 estimates how long it takes your money to double: divide 72 by your annual interest rate. At 6% APY, your money doubles every 12 years (72 ÷ 6). At 8%, every 9 years. At 4% (typical HYSA), every 18 years. This shows why even small differences in returns matter enormously over long time horizons.

How much should I have in an emergency fund?

Standard financial planning recommends 3–6 months of essential expenses. On $4,000/month in expenses, your target is $12,000–$24,000. Keep emergency funds in a HYSA (4–5% APY in 2026) for liquidity. Use our calculator with a 4.5% rate to plan how long it takes to build your emergency fund with your current monthly savings.

What is the difference between nominal and real interest rate?

Nominal rate is what the bank or investment account states. Real rate accounts for inflation: Real Rate ≈ Nominal Rate − Inflation Rate. With 5% HYSA and 3% inflation, your real return is ~2%. For long-term planning (10+ years), reduce your rate by 2–3% to estimate real purchasing power. Our calculator uses nominal rates — subtract inflation manually for real returns.

How does starting early affect compound interest?

Starting 10 years earlier can more than double your final savings. Example: $300/month at 7% for 30 years = $340,000. Starting 10 years later ($300/month at 7% for 20 years) = $157,000 — less than half. The early years produce little visible growth but create the foundation that makes the final decades explosive. Time is the most powerful variable in compound interest.

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