# Savings Goal Timeline Calculator

It could be a long time before you meet your savings goals. And that’s where this calculator can help. By using this handy tool, you can learn how long it will take before you meet your financial goals.

First enter the amount you have already set aside and the amount you wish to accumulate. Enter a monthly addition you can afford to make and the annual interest rate attached to your savings account. Press CALCULATE and you’ll instantly see how long it will take to realize your goals.

## Today's Savings Rates

The following table shows current rates for savings accounts, interst bearing checking accounts, CDs, and money market accounts. Use the filters at the top to set your initial deposit amount and your selected products.

## How Long Will it Take to Reach Your Savings Goal?

Saving goals vary by income, age, and interest. However, one factor remains constant to all savers: time. Whether it's a college fund, mortgage, car, or retirement, patience and careful planning can help you stay on a time line and reach your goals sooner. Consider these factors to help you determine how long it will take to reach your goal.

### How This Calculator Works

Interest is compounded monthly and is added to your total savings each time a monthly deposit is made. Calculations are done with deposits made at the beginning of each month, starting in the current month. If you make deposits at the end of each month, then please subtract your typical monthly deposit from the "current savings" field. For example, if you had ...

- no upfront savings & were saving $200 per month at the end of each month you would set
*current savings*to -200 - $5,000 saved upfront & were saving $200 at the end of each month you would set
*current savings*to 4800

### Compound Interest Formulas

**Single deposit**

FV = PV * (((1 + r/n)^{nt}

**Series of deposits **

beginning of the month

FV = PMT * (((1 + r/n)^{nt} - 1) / (r/n)) * (1 + r/n)

end of the month

FV = PMT * (((1 + r/n)^{nt} - 1) / (r/n))

To add a single upfront deposit with a stream of ongoing deposits you can calculate the two sums independently & then add them together.

Here are the formula variable definitions:

- FV = future value
- PV = present value of the initial deposit
- PMT = periodic deposit
- r = annual interest rate, as a decimal
- n = times interest is compounded per year
- t = years invested

The above calculations are fairly straightforward so long as the deposits are made at the same frequency at which interest compounds. If the deposit frequency is different than the compounding frequency then the calculations can get quite complex, particularly if weeks and months are used as one variable is 7 & the other ranges from 28 to 31 and leap year also must be accounted for.

If you wanted to account for the impacts of inflation on the spending power of your savings when you reach your savings goal you would then subtract the annual rate of inflation (i) as a decimal from the final savings for *n* years.

PV = FV * ( 1 - i)^{n}

### Line Up Your Goals with Your Motivations

As with many tasks in life, getting started is often the hardest part of saving. Set aside time to think about your top goals. Much of the motivation for savings arises from daydreaming. Whittle down what you envision to a top five list and consider how those main desires are linked. Reaching one goal often enables reaching another, greater goal. To fully break the barrier, write your goals or create a vision board. Concretely stating your goal often increases the odds of its achievement. Better still, make your goal or goals as specific as possible for ultimate motivation.

### Evaluate Your Budget

An important step in reaching goals requires trimming your bad, or at least excessive, spending habits. Devote a month to tracking spending. Consider creating a pie chart that breaks your spending into categories, such as groceries, rent, utilities, shopping, and insurance. The chart will help you recognize where you need to cut back, whether changing spendthrift in the market or turning down a few weekend invitations.

In addition, set a budget based on an ideal amount to put aside. Try an online budget calculator to help determine what percentage of your income to assign to savings. Generally, multiply your take-home pay by 0.2 percent. Anywhere between fifteen and twenty percent falls into the happy medium. You don't want to undercut how much you could be saving, but you also want to avoid settling for sardines and crackers.

### Set Small Milestones

Looking at the big picture proves overwhelming. To make realizing your goal more palatable, set smaller monetary milestones. For example, saving for a college fund looks daunting when considering the end number is something to complete over many years. However, if you set a yearly, monthly, weekly, and even daily dollar goal, it becomes easier to succeed by offering a clear day-by-day plan toward your goal.

### Eliminate Temptation

Much of savings involves resisting the temptation to tap into them for other purposes, often impulsively and destructively. Intervene against spending urges by making your savings inaccessible.

Plan to keep your savings at a separate financial institution from your regular banking institution. Always opt for direct deposit so the allotted amount doesn't even register on your up-for-grabs radar.

For long-term goals, as in those that require ten years or more, look for investments, bonds, and shares to provide inflation security. With a professional to manage your deposit plan, you can assign an absolute timeline to your savings goal and essentially expedite the savings process.

Savings don't accumulate without careful planning, calculation, patience, and control. Concentrate on small gains and you'll reach your big picture dreams and watch them become a reality.

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