$120,000 in 4 years, starting from $25,000 at 4.5%
- Deposit needed each period
- $1,716
- Target
- $120,000
- Starting balance
- $25,000
A demanding monthly figure. Extend the term to five years and re-run to see how much the deadline is costing you.
How much do I need to save?
Start from the target and the deadline, and this works out the contribution needed to get there.
It accounts for what you already have and the interest it earns, so the required contribution is lower than dividing the shortfall by the number of periods.
Savings goal calculator
Works out how much to set aside each period to reach a savings target by a deadline.
What to enter
Target amount
What you need. For a house deposit, run the property buying costs calculator first — the deposit alone is well short of the cash required.
Annual rate
What the balance earns. For a savings horizon of a few years this is a savings account or term deposit rate, and it should be conservative.
Reading the result
The contribution is what to transfer each period. Automate it: a transfer that happens on payday before anything else is spent is the single most reliable savings mechanism there is.
If the figure is not achievable, the levers are the target, the deadline and the starting balance. Extending the deadline reduces the contribution more than most people expect, because both the contributions and their earnings have longer to work.
Interest does comparatively little over a short horizon. Over three years, most of the target comes from your contributions, and the rate is not the thing to optimise.
Worked examples
Every figure below is computed by the same calculator on this page, from the inputs described. Nothing here is typed in by hand, so an example cannot disagree with the tool.
How it is worked out
The starting balance is grown forward to the target date at the given rate. The remaining shortfall is what the contributions must cover.
The contribution is the amount whose accumulated value, with interest earned along the way, exactly equals that shortfall at the end of the term.
What it assumes
The rate holds and the contributions never stop
Both are assumptions about the future, and the second is the one that usually breaks first.
No tax on the interest
Interest earned outside superannuation is generally assessable income. Over a short horizon and a modest balance the effect is small, but it is not zero.
Where it stops being right
Inflation is not modelled
A deposit target set against today’s prices will be short if prices rise while you save, which is the structural difficulty of saving for a house.
Related calculators
Savings goal timing calculator
Works out how long a savings target takes to reach at your current rate of saving.
Compound interest calculator
Shows how a balance grows over time with regular deposits and compounding interest.
Term deposit calculator
Works out the interest and maturity value on a term deposit, with interest reinvested or paid out at maturity.
Property buying costs calculator
Adds transfer duty to your deposit and the other upfront costs, to show the cash you need to complete a purchase.
Putting this calculator on your own site
This calculator can be embedded on a business website, branded to match it, with a call to action that sends the enquiry to that business rather than collecting anything here.