Savings Account Calculator

The most straightforward engine on the site, and the one whose answer is least about the arithmetic. Your balance earns the rate you set, credited monthly or once a year — monthly compounding gets you slightly more from the same stated rate, and the results panel shows the effective rate the two work out to. Deposits arrive throughout the year rather than all in January, so a year’s contributions earn roughly half a year’s interest.

The number worth reading is not the final balance. It is the line underneath showing what that balance buys in today’s money. Cash is the one tab where the nominal figure and the real figure tell opposite stories: a balance that grew every year can still be worth less than what you put in, and if your rate sits below inflation the tab says so outright, with the yearly loss of purchasing power spelled out. That is not a flaw in savings accounts. It is the price of the two things they are for — getting your money back, and getting it today.

Withdrawals are a flat monthly amount, and the tab reports whether the fund runs dry or lasts the whole horizon. There are no phases or percentage modes here, because a savings account is usually the thing you are drawing from between one event and the next, not the thing you retire on.

The rate is the point at which this projection is least believable, and it is the only input that really matters. High-yield savings rates float with central bank rates and are not locked in the way a GIC or a CD is. A 4% account can be a 1% account within a year, with no notice and nothing you can do about it, and this tab holds whatever you type for the entire horizon. Promotional rates make it worse: many of the best-advertised numbers apply for three or six months to new money only, then quietly revert to something ordinary.

What the arithmetic leaves out sits around the edges. Deposit insurance is not modelled, and it has limits — CDIC covers $100,000 per category per institution in Canada, FDIC $250,000 per depositor per bank in the United States. Nor are monthly fees, minimum balance requirements, or the transfer delays that decide whether money is actually available the day you need it. And interest is taxed as ordinary income rather than at capital-gains rates, while the tax setting here applies the capital-gains treatment, so like Bonds, this tab flatters the outcome.

None of which is an argument against holding cash. It is an argument for knowing what the balance is for, and for not mistaking a safe number for a growing one.