How it works
First we grow what you already have to the deadline. Whatever is still missing must come from monthly deposits, which earn interest for less time the later they are made. The deposit is the amount that fills the gap exactly.
D = (G − S × (1 + r)n) × r ÷ ((1 + r)n − 1)
- D — monthly deposit
- G — goal
- S — already saved
- r — yearly rate ÷ 12 ÷ 100
- n — number of months
For goals under three years, a higher rate changes the answer only a little; time and the starting amount matter far more. For long goals such as retirement, the rate does most of the work.