Monthly savings projection
Monthly savings projection with month-end deposits and monthly compounding. 100,000 a month at 5% for 3 years grows to 3,875,333.55.
Assumes deposits are made at the end of each month. Taxes and fees are not included.
Formula estimate only. Rates, taxes, and legal rules vary by jurisdiction.
What to know
The savings page replaces the lump-sum principal with a Monthly deposit. It assumes each deposit lands at the end of its month and compounds monthly at the annual rate divided by 12, so the value is the future value of an ordinary annuity: M x ((1 + i)^N - 1) / i, with i = rate / 12 and N = 12 x years.
Worked example: 100,000 a month at 5 percent for 3 years has i = 0.05 / 12 and N = 36, so the balance is 3,875,333.55. You put in 36 x 100,000 = 3,600,000, which leaves 275,333.55 of interest. Over 1 year the same deposit grows to 1,227,885.55.
The three summary lines are Maturity value, Total deposits and Interest earned. With a 0 percent rate the page falls back to deposit x months, so 100,000 for 36 months is exactly 3,600,000. The term does not have to be a whole number of years, and it is rounded through N = 12 x years in the formula.
Bank instalment savings products often calculate interest per deposit with simple interest, and some pay on different schedules, so the statement from a provider can differ from this compounding model. Taxes and fees are not included.
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How to use Monthly savings projection
- Enter Monthly deposit 100,000.
- Set the annual rate to 5 percent and the term to 3 years.
- Read the Maturity value line, which shows 3,875,333.55.
- Compare Total deposits (3,600,000) with Interest earned (275,333.55).
Quick answers
When is each deposit assumed to be made?
At the end of each month, so the first deposit earns interest for 35 months in a 36-month plan and the last deposit earns none.
How much do I save in 5 years at 100,000 a month and 5 percent?
6,800,608.28, from 60 deposits of 100,000 with monthly compounding.
Why does my bank show a lower maturity value?
Many instalment products pay simple interest on each deposit and deduct tax. Both effects reduce the total relative to this compounding model.