Savings Calculator

Savings Interest Calculator

Your savings serves as the cornerstone of your financial life. Building savings takes a mix of consistent habits, smart account choices and a clear view of your overarching timeline. By finding a suitable combination of interest rates and contribution strategies, it can make a noticeable difference over time. A savings calculator like this one can help you see what you need to do in order to reach your savings goals.

A financial advisor can help you incorporate your savings into a larger financial plan. To find a financial advisor who serves your area, try SmartAsset's free online matching tool.

Using SmartAsset’s Savings Calculator

Our Savings Calculator provides a valuable snapshot of how your savings can grow over time. Just enter a few details, like your starting balance, annual percentage yield (APY), additional monthly contributions and how many years you plan to save, to see your projected total savings for the future.

Starting Savings Balance

Your starting savings balance is the initial, or principal, amount you deposit into your account. Add this number into our calculator as your starting point. You can enter any amount, though some savings accounts have minimum deposit requirements, so be sure you understand these rules for any accounts you plan to open.

Annual Percentage Yield

Your account’s interest rate, or APY, directly affects how much your savings grow over time. You’ll enter this annual growth rate for your account into our calculator, along with the compounding frequency of the account (daily, monthly, quarterly, semiannually or annually), which is usually referenced on the bank's website. The more frequently interest is compounded, the more your savings can grow, since your interest earns interest more often.

The average APY on savings and interest-bearing checking accounts in mid-2025 is 0.38%, according to the Federal Deposit Insurance Corporation (FDIC). However, rates can vary significantly between banks and types of accounts. While large institutions like Chase or Bank of America tend to offer lower rates, they may appeal to some due to ATM access, branch locations or other factors. On the other hand, online banks often offer higher rates because they operate with fewer overhead costs. Credit unions, which are nonprofit and member-focused, may also offer competitive rates.

To boost your rate, try looking into tiered interest structures. Higher balances can unlock better rates, and linking a checking account may also qualify you for an increase. Comparing accounts online or through SmartAsset’s savings comparison tool can help you find options for maximizing your interest earnings.

Additional Contribution

Although not required, making additional contributions into your savings account will help your savings grow faster, so it is recommended depending on your goals. Not only are you setting aside more money, but you also add to the principal that accrues interest. Entering your recurring monthly deposits into our savings calculator will help you understand how additional deposits can boost your returns.

Years to Save

Your APY and additional deposits have a direct impact on the value of your savings over time. The same is true for the number of years that you save your money for. The longer you leave the funds in the account, the more you’ll end up with due to the power of compound interest.

For example, imagine that you want to buy a home in two years. You have $25,000 that you’d like to put toward a down payment and plan to add $500 per month. In two years, you’d have nearly $40,000 in savings, assuming a 4.00% APY. Now imagine taking five years to save for a down payment instead of two. Those three extra years of deposits and compound interest would boost your down payment to more than $63,500, really showcasing how helpful long-term compounding can be.

Types of Savings

There are a variety of account options available on the market, most notably including traditional and high-yield savings accounts, certificates of deposit (CDs) and money market accounts.

Traditional Savings Account

A traditional savings account is a run-of-the-mill savings vehicle offered by most major, brick-and-mortar banks and credit unions. These accounts are reliable, safe places to keep emergency funds and other savings. However, they typically offer paltry rates, so they’re not an ideal vehicle for growing wealth. In fact, major national banks often have savings accounts with an APY of as low as 0.01%.

High-Yield Savings Account

High-yield savings accounts are essentially the same as traditional savings account, but they typically pay quite a bit more in interest, hence their title. While the aforementioned average APY of savings and interest checking accounts was 0.38%, high-yield accounts typically have APYs that five to ten times greater than that, depending on the specifics of the market at any given time.

However, not every institution makes a high-yield savings account available to its customers, but online banks that do not have brick and mortar locations are more likely to offer these products. If you’re interested in a high-yield savings account, review our list of the Best Savings Accounts to find one that may suit your needs.

Certificate of Deposit (CD)

A certificate of deposit, or CD, is a savings product that lets you lock up your money for a set period of time, typically anywhere from a few months to several years. In exchange, you also lock in an interest rate that won’t change during the term, as opposed to a savings account where the rate changes over time. In most cases, the longer the CD term, the better the rate you’ll typically get.

Unlike a traditional or high-yield savings account, you can’t dip into a CD whenever you like. If you withdraw early, most banks charge a penalty. Then again, if you know you won’t need the money for a certain length of time, a CD can be a good alternative to a traditional savings account, as they can sometimes boast better interest rates.

The national average interest rates for CDs range from 0.23% to 1.62%, according to mid-year 2025 data from the FDIC. If you’re interested in finding a CD, take a look at our list of the Best CD Rates.

Money Market Account

A money market account is another savings vehicle that often pays a higher interest rate than a standard savings account. For example, the average money market account interest rate was 0.59% as of mid-year 2025 data from the FDIC. Money market accounts can also come with check-writing privileges or a debit card. This flexibility makes them more of a hybrid between high-yield savings accounts and checking accounts.

Banks and credit unions typically offer these accounts. However, they may have higher minimum balance requirements and recurring fees. If you’re interested in opening one, you may want to review our list of the Best Money Market Accounts.

How Much Does the Average American Have in Savings?

According to the Federal Reserve’s most recent Survey of Consumer Finances from 2022, the median American household has just $8,000 in transaction accounts. Transaction accounts comprise savings, checking money market accounts, as well as prepaid debit cards. The average savings in transaction accounts is significantly higher at $62,500 due to outliers that skew the average higher.  

How Much Should I Have in Savings?

The answer to this question will ultimately depend on your individual financial goals and timeline. Experts recommend having an emergency fund on hand with enough to cover between three and six months’ worth of living expenses. This fund can serve as a financial cushion in case you lose your job or have a significant expense you need to cover.  

For example, if you have a $5,000 monthly budget you would want to keep between $15,000 and $30,000 in an emergency fund. It’s important to keep this cash in an easily accessible FDIC-insured account, preferably a high-yield savings or money market account to ensure the money continues to grow.

Beyond an emergency fund, you may also save for short-term financial goals like buying a home in the next year or two. A savings account is the ideal place for money you’ll need in the short term, as investing may offer higher returns, but it also exposes your savings to significantly more short-term risk.

For example, imagine that you're saving to buy a house in the next year. You already have $100,000 for a down payment, but the money is invested in mutual funds. If the stock market remains flat or rises in value over the next year, you’ll have an even larger down payment. But if stocks drop suddenly like they can, you could lose money and ultimately jeopardize your goal of buying a home.

How to Maximize Your Savings

No matter your financial goals, there are various strategies you can use to maximize your savings. Whether it’s setting up automatic monthly deposits, using the 50/30/20 budget or building a CD ladder, you can find a strategy to save more money.

Automate Your Savings

You can also maximize your savings by setting up monthly transfers to your savings account. Even small transfers help grow your balance, giving you more money to earn interest on. You can set up an automatic deposit directly from your paycheck or from your checking account. Either way, these recurring, automatic deposits can help you meet your financial goals quicker.

50/30/20 Budget

The 50/30/20 budget is a basic, but effective framework for allocating your earnings. Here's how it works:

• The budget calls for you to use 50% of your take-home pay on “needs.” These expenses include housing, food, utilities and other necessities.
• Allocate 30% of your take-home pay to your wants, which means discretionary spending on things like eating out, vacations and more.
• Save and/or invest the remaining 20% of your after-tax income for both short- and long-term goals.  

For example, say that you earn $50,000 per year after taxes. Using the 50/30/20 budget, you would limit your living expenses to $25,000, your discretionary spending to $15,000 and save the remaining $10,000.

Build a CD Ladder

CDs can be a safe and effective way to grow your savings over time. In exchange for locking up your money for a set period of time, you receive your principal and interest when the CD matures. A CD ladder helps you access higher rates without tying up all your money long term. Instead of investing a lump sum into a single long-term CD, you strategically split your principal between CDs of varying maturities. As each CD matures, you can either cash it out or reinvest the principal and interest into a new account with the longest term and highest rate.

For example, to build a $5,000 CD ladder you would invest $1,000 into a one-, two-, three-, four- and five-year CD. The one-year CD would mature the following year, at which point you could invest the principal and interest in a new five-year CD. The two-year CD would mature the next year, and the process would continue.