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5 Savings Account Calculator

Reviewed by Calculator Editorial Team

This 5 Savings Account Calculator helps you estimate how much your savings will grow over 5 years with compound interest. Simply enter your initial deposit, monthly contribution, and expected annual interest rate to see your future balance.

How to Use This Calculator

Using this calculator is simple:

  1. Enter your initial deposit amount in the "Initial Deposit" field.
  2. Enter your monthly contribution amount in the "Monthly Contribution" field.
  3. Select your expected annual interest rate from the dropdown menu.
  4. Click the "Calculate" button to see your future savings balance.

The calculator will display your estimated balance after 5 years, showing how much your money will grow with compound interest.

Formula Used

The future value of your savings is calculated using the compound interest formula:

FV = P(1 + r/n)^(nt) + PMT * (((1 + r/n)^(nt) - 1) / (r/n)) Where: FV = Future Value P = Initial Deposit PMT = Monthly Contribution r = Annual Interest Rate (as a decimal) n = Number of times interest is compounded per year (12 for monthly) t = Number of years (5)

This formula accounts for both your initial deposit and regular monthly contributions, with interest compounded monthly over 5 years.

Worked Example

Let's say you have $1,000 as an initial deposit and contribute $200 each month to a savings account with a 4% annual interest rate. Here's how the calculation works:

Initial Deposit: $1,000
Monthly Contribution: $200
Annual Interest Rate: 4%
Time Period: 5 years

The calculator would show that your savings would grow to approximately $1,825 after 5 years. This accounts for the compounding of interest on both your initial deposit and monthly contributions.

Frequently Asked Questions

How accurate is this calculator?

This calculator provides an estimate based on the inputs you provide. Actual results may vary depending on market conditions and other factors.

Does this calculator account for taxes?

No, this calculator does not account for taxes. The interest earned may be subject to taxation depending on your jurisdiction.

Can I use this calculator for different time periods?

This calculator is specifically designed for a 5-year time period. For different time periods, you would need to adjust the formula accordingly.