How this calculation works
Grow the starting savings to the target date, subtract that amount from the target, and divide the remaining gap by the future-value factor of monthly deposits. The factor is n at zero interest; otherwise it is [(1+r)ⁿ − 1] ÷ r, multiplied by (1+r) for deposits at the beginning of each month.
M = max[0, T − P(1+r)ⁿ] ÷ annuity factorA worked example
With ₹10,000 already saved, a ₹1,00,000 target and 12 months at zero return, the monthly requirement is ₹7,500.
Good to know
Uses equal monthly deposits, a constant nominal annual return and monthly compounding. Monthly saving is rounded upward to the next paise. No withdrawals, changing returns, fees, tax or inflation adjustment of the target.
Reference: Investor.gov: savings goal inputs (opens in a new tab) ↗
Separate the money you already have from the money you will add
A target is not always the amount that still needs saving. With ₹10,000 already set aside and a ₹1,00,000 goal, the gap is ₹90,000 at zero growth. Over twelve months, that gives ₹7,500 per month rather than ₹8,333.33.
When a positive return is assumed, the starting balance and each new deposit spend different amounts of time growing. The tool accounts for those dates instead of applying a full year’s return to every monthly contribution. You can compare deposits made at the beginning and the end of each month.
Before entering a starting balance, decide which money truly belongs to this goal. Including funds needed for another expense can make the monthly result look easier without changing the competing claims on your savings.
Adjust a plan by changing an input you control
If the required amount does not fit your budget, test a longer timeline, a smaller target or a larger starting allocation. Compare each change one at a time. Raising the assumed return also lowers the modeled monthly saving, but it does not create a dependable source of extra money.
For a purchase that may become more expensive, first estimate its cost at the target date. A ₹1,00,000 target here means ₹1,00,000 at the end of the entered period; it is not automatically increased for inflation.
The monthly amount is rounded upward to a paise, so the modeled final balance can be slightly above the target. A zero contribution means the starting savings alone grow to the target under the chosen assumptions. It does not represent a guarantee or a recommendation to stop reviewing the plan.
A few questions, answered
What happens at zero return?
The remaining target gap is divided equally across the entered months. This is a useful baseline when comparing a plan with a more optimistic scenario.
Why does beginning-of-month timing need less saving?
At a positive assumed rate, every deposit gets one additional month of growth. At zero rate, the timing choices give the same answer.
Does it choose an investment for me?
No. You supply the return assumption. The calculator does not select a product, assess risk or account for taxes and fees.