Savings Deposit Required to Reach a Goal

Example #1: How much must be put into a savings account each quarter in order to have $4,000 in 3 years? The account earns 7% interest compounded quarterly, and deposits begin immediately.

Enter the following values in the input fields:
Present Value = 0
Future Value = 4000
Periods = 12 (i.e. 3 X 4 = 12)
Periods/Year = 4
Interest Rate = 7
Set Payment/Deposit Timing for Begin since the deposits begin immediately.

Now click the Payment/Deposit button. Result: Deposit = 297.25. See the screen snapshot of this calculation below:

Example #2: How much must be deposited annually into an investment account with an initial balance of zero in order for it to have a future value of $100,000 in 10 years? Estimate the account earns 10% annually. The annual deposits begin immediately.

Enter the following values in the input fields:
Present Value = 0
Future Value = 100,000
Periods = 10
Periods/Year = 1
Interest Rate = 10
Set Payment/Deposit Timing for Begin since the deposits begin immediately.

Now click the Payment/Deposit button. Result: Deposit = 5,704.13 (each year). See the screen snapshot of this calculation below:

Example #3: How much must be deposited monthly into an investment account with an initial balance of $7,000 in order for it to have a future value of $50,000 after 10 years? The account earns 8% compounded monthly and the monthly deposits begin immediately.

Enter the following values in the input fields:
Present Value = 7000
Future Value = 50,000
Periods = 120 (10 x 12)
Periods/Year = 12
Interest Rate = 8
Set Payment/Deposit Timing for Begin since the deposits begin immediately (i.e. at the beginning of the first compounding period).

Now click the Payment/Deposit button. Result: Deposit = 187.13 each month. See the screen snapshot of this calculation below:

Example #4: How much must be deposited monthly into an investment account with an opening balance of $5,000 in order for it to have a future value of $20,000 in six years? The account earns 6.5% compounded monthly and the first deposit occurs at the end of the first compounding period (i.e. one month after opening the account).

Enter the following values in the input fields:.
Present Value = 5,000
Future Value = 20,000
Periods = 72 (6 x 12)
Periods/Year = 12
Interest Rate = 6.5
Set Payment/Deposit Timing for End since the deposits begin after the first compounding period (i.e. at the end of the first compounding period).

Now click the Payment/Deposit button. Result: Deposit = 143.82 each month. See the screen snapshot of this calculation below:

Examples

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