Savings Growth Calculator

Compound interest in plain words: your money earns a return, and then that return starts earning returns of its own. This calculator simulates it month by month — each month the balance grows by one-twelfth of your annual rate, then your contribution is added. That's why the "Balance" line on the chart pulls away from the "Total contributed" line: early on they're nearly identical, and the gap between them — pure growth — widens every year. Two people saving the same amount per month end up in very different places if one started ten years earlier, because those early dollars have the most time to compound.

A worked example

Take the defaults: $5,000 to start, $300 a month, 7% a year, 20 years. You put in $77,000 of your own money ($5,000 plus 240 contributions of $300). The projected ending balance is about $176,000 — roughly $99,000 of it growth you never deposited. Open the year-by-year table and notice the shape: growth in year one is a few hundred dollars, while growth in year twenty is over $11,000. Compounding is slow, then sudden.

One honest caveat: those are future dollars

The ending balance is stated in future dollars, and inflation means each of them will buy less than a dollar does today. The 7% hint on the rate field is a rough long-run average for the U.S. stock market before inflation; after inflation the long-run figure is closer to 4%. If you want the answer in something like today's purchasing power, enter 4% instead of 7% — the balance will look smaller, but it's the more honest number for questions like "will this be enough?"

Common questions

Is 7% guaranteed? No. It's a long-run historical average that includes crashes and bear markets along the way. Real returns arrive lumpy — some years up 20%, some years down 20% — and a constant 7% line is a smoothing assumption, not a promise. Savings accounts and CDs pay less but don't have down years; stocks average more but do.

Monthly or annual compounding? We compound monthly, which matches how most savings accounts credit interest. The difference from annual compounding is real but small — at 7%, monthly compounding is equivalent to about 7.23% compounded annually. Don't let the distinction stop you from saving.

Where does an emergency fund fit? Before this calculator, honestly. Money you might need next year shouldn't ride the stock market — size a cash cushion first with the emergency fund calculator, then point long-term money at growth.

This is a projection based on a constant assumed return, not a guarantee, and it's general information — not personalized investment advice. Found an error? Tell us and we'll fix it.