Savings Calculator
Calculate how your savings grow with compound interest. Enter your initial deposit, interest rate, time period, and regular contributions to see your projected balance.
Savings Details
Regular Contributions
Results
Year-by-Year Summary
| Year | Balance | Contributed | Interest |
|---|---|---|---|
| 1 | $12,851.91 | $12,400.00 | $451.91 |
| 2 | $15,820.01 | $14,800.00 | $1,020.01 |
| 3 | $18,909.03 | $17,200.00 | $1,709.03 |
| 4 | $22,123.91 | $19,600.00 | $2,523.91 |
| 5 | $25,469.76 | $22,000.00 | $3,469.76 |
This calculator provides estimates only. Actual returns may vary based on interest rates and compounding methods.
How Compound Interest Works
Compound interest means you earn interest not just on your initial deposit, but also on the interest you've already earned. Over time, this creates exponential growth — often called the “snowball effect.”
For example, $10,000 invested at 5% annual interest compounded monthly becomes about $16,470 after 10 years — without any additional contributions. Add $200/month and you'll reach approximately $47,000.
Tips for Growing Your Savings
- Start early: Time is the most powerful factor in compound growth.
- Contribute regularly: Even small monthly additions compound significantly over decades.
- Compare APY vs APR: APY (Annual Percentage Yield) accounts for compounding; APR does not.
- High-yield savings accounts: Online banks often offer 4–5% APY vs. 0.5% at traditional banks.
- Tax-advantaged accounts: 401(k), IRA, and similar accounts let your savings compound tax-free or tax-deferred.
Frequently Asked Questions
What is the difference between APR and APY?
APR (Annual Percentage Rate) is the simple annual interest rate. APY (Annual Percentage Yield) accounts for compounding — so a 5% APR compounded monthly is actually a 5.12% APY. When comparing savings accounts, always compare APY.
How often should interest compound for the best returns?
More frequent compounding means slightly higher returns. Daily compounding beats monthly, which beats annual. In practice, the difference between daily and monthly compounding is small, but both are significantly better than annual.
Are these results guaranteed?
No. This calculator shows projections based on a fixed rate. Actual returns depend on market conditions, the type of account, and whether the institution maintains the advertised rate.
What's a realistic savings interest rate?
As of 2025, high-yield savings accounts offer 4–5% APY. Traditional bank savings accounts average around 0.5%. CDs may offer slightly higher rates for locking in funds. Investment accounts (index funds) have historically returned 7–10% annually, though with more risk.