How to use the savings goal calculator
Choose Emergency fund to size a safety net from your essential bills, or Savings goal for anything else: a down payment, a car, a wedding, or a trip. Enter what you've saved and your account's interest rate, and the calculator shows how long it will take or how much to set aside each month.
How much emergency savings do you need?
Start from your essential monthly expenses, not your income. Then multiply by the months of cover that fit your situation:
| Essentials per month | 3 months | 6 months | 9 months |
|---|---|---|---|
| $2,000 | $6,000 | $12,000 | $18,000 |
| $3,000 | $9,000 | $18,000 | $27,000 |
| $4,000 | $12,000 | $24,000 | $36,000 |
| $5,000 | $15,000 | $30,000 | $45,000 |
Two steady incomes can usually lean toward 3 months. One income, dependents, or a job in a shaky industry points toward 6. Freelance, commission, or seasonal income calls for 9 or more, because lean months happen even without an emergency.
Example: building a 6-month fund
With $3,100 a month in essentials, a 6-month fund is $18,600. Starting with $3,000 and saving $400 a month at 3.5% APY takes 3 yrs 1 mo, and the account earns about $1,127 in interest along the way. Saving $600 a month cuts that to 2 yrs 1 mo. The first month of cover comes almost right away, which already handles most surprise bills.
Saving for a goal: how much each month?
Monthly savings needed to reach $10,000 from zero:
| Time to goal | No interest | At 4% APY | Interest saves you |
|---|---|---|---|
| 1 year | $833 | $818 | $179 |
| 2 years | $417 | $401 | $371 |
| 3 years | $278 | $262 | $561 |
| 5 years | $167 | $151 | $934 |
Interest helps, but for goals a few years away the monthly amount you save matters far more than the rate. Choose a safe account for short-term goals rather than chasing returns in the stock market.
Where to keep your savings
- High-yield savings or money market accounts at insured banks or credit unions. In the US, FDIC insurance covers $250,000 per depositor, per bank, per ownership category.
- A separate account from everyday checking, so the money isn't spent by accident. Naming it after the goal helps.
- Automatic transfers on payday make saving the default instead of whatever is left over.
Finding money to save
- The budget calculator shows where each month's money goes and what's left.
- The take-home pay calculator shows your real paycheck after taxes and deductions.
- Paying off debt frees up money to save; plan it with the debt payoff calculator.
- Saving for decades rather than years? Use the compound interest calculator.
Sources: the Consumer Financial Protection Bureau's essential guide to building an emergency fund and the FDIC's Understanding Deposit Insurance.
Frequently asked questions
How much should I have in an emergency fund?
A common guideline is 3 to 6 months of essential expenses: housing, utilities, food, transportation, insurance, and minimum debt payments. Aim higher, around 9 to 12 months, if your income is irregular, you're self-employed, or one income supports the household.
Should I base my emergency fund on income or expenses?
Expenses. The fund has to cover the bills you can't skip if your income stops, not replace your full paycheck. Cutting dining out, subscriptions, and retirement contributions in an emergency means you need less than your take-home pay.
Where should I keep my emergency fund?
Somewhere safe and easy to reach within a day or two, such as a high-yield savings account or money market account at an FDIC-insured bank or NCUA-insured credit union. Avoid stocks, which can fall just when you need the money, and keep it separate from your everyday checking so it isn't spent by accident.
Should I save for emergencies or pay off debt first?
Many people do both in stages: save a starter fund of about one month's essentials, then put extra money toward high-interest debt like credit cards, then finish the full fund. Without any savings, a surprise bill often ends up back on a credit card.
How much should I save each month for a goal?
Divide what you still need by the months until your deadline, then subtract a little for interest if the money earns some. The calculator does this exactly, and shows weekly and every-two-weeks amounts to match your paychecks.
Does interest make a big difference?
Over a few years, a little. Saving $10,000 in 3 years at 4% APY takes about $262 a month instead of $278 with no interest. Over decades, compounding matters much more; see the compound interest calculator for long-term growth.
This guide is for general education and is not financial, tax, or legal advice. See our disclaimer.