How to use the Savings Goal Calculator
- Enter your target amount and what you have saved so far.
- Choose how many years you have and the interest rate your savings earn (a high-yield savings account or CD rate, for example).
- Read the monthly deposit needed plus weekly and daily equivalents.
How it works
Your current savings grow on their own; the monthly deposit covers the rest. Solving the future-value-of-annuity formula for the payment:
PMT = (Goal − Saved × (1 + r)n) × r ÷ ((1 + r)n − 1)where r is the monthly rate and n the number of months. Deposits are assumed at the end of each month.
Frequently asked questions
Where should I keep money for a short-term goal?
For goals under about five years, savers usually prefer low-risk places such as high-yield savings accounts, CDs or Treasury bills, because stock markets can fall right when you need the money.
What if I cannot afford the monthly amount?
Extend the timeline, lower the goal, or start smaller and raise the deposit when your income grows. Automating the transfer on payday makes it easier to stick with.
Is interest on savings taxable?
Yes. Interest from savings accounts and CDs is generally taxable income in the year it is earned, unless it is inside a tax-advantaged account.