Savings Goal Calculator

What you already have grows first: saved x (1 + r)^n, at the monthly rate r over n months. The rest comes from the monthly payment, found by inverting the future value of a series: PMT = needed x r / ((1 + r)^n - 1). With no interest it is simply the shortfall divided by the months.

How much should I save each month?

For a specific goal, whatever this says. As a general habit, 20 percent of take-home pay is the common target, split between retirement, an emergency fund and shorter goals.

Does interest help much on a savings goal?

Over two or three years, barely. On a 20,000 dollar goal at 4 percent you might earn a few hundred dollars. Interest only becomes the main driver past roughly ten years, which is why short goals are about the deposit, not the rate.

Where should short-term savings sit?

Somewhere the value cannot fall before you need it: a high-yield savings account, a money market fund or a CD timed to the date. Money needed within five years generally does not belong in the stock market.