CalculatorsSavings calculator
Savings calculator
If you save this much regularly at this interest rate, see how much you could have, and whether you're on track for a goal.
Your plan
Tell us about your savings plan
The AER shown on your account, not a monthly rate.
Check your progress toward a target amount.
Projected savings after 5 years
£14,452
Your savings could earn £1,452 in interest over 5 years. About 10% of your final balance came from interest, not your own deposits.
- Term
- 5 years
- Deposited
- £13,000
- Interest earned
- £1,452
- Projected final balance
- £14,452
Year-by-year breakdown
| Year | Deposits | Interest | Balance |
|---|---|---|---|
| 1 | £2,400.00 | £83.69 | £3,483.69 |
| 2 | £2,400.00 | £183.04 | £6,066.72 |
| 3 | £2,400.00 | £286.36 | £8,753.08 |
| 4 | £2,400.00 | £393.81 | £11,546.89 |
| 5 | £2,400.00 | £505.56 | £14,452.46 |
How it works
How much could your savings grow?
This calculator takes the savings you already have, adds whatever you plan to deposit regularly, and applies your account's interest rate month by month for however long you're saving, so you can see not just a final number, but how your balance builds up along the way.
It's built around the question most people actually have when they open a savings account: if I keep saving this much, at this rate, what could I end up with? That's different from asking how compounding mechanics work in the abstract. That's what the compound interest calculator is for.
Want to explore how different compounding frequencies affect growth? Use the compound interest calculator →
Savings interest
How savings interest works
A savings account pays you interest for keeping your money there, usually as a percentage of your balance, added at regular intervals. As interest is added, it becomes part of your balance, so it goes on to earn its own interest too. That's why a savings balance grows a little faster each year, even without adding anything more.
This calculator applies your account's interest rate to your balance every month, adding any deposits due that month straight after, so a deposit starts earning interest from the following month, not the one it was paid in. That matches how most UK savings accounts actually credit interest.
Important for UK savers
What does AER mean?
AER stands for Annual Equivalent Rate. It's the standard figure UK banks and building societies are required to quote so that savings accounts can be compared fairly, whatever their actual interest rate or payment schedule.
Some accounts pay interest monthly, others annually, and some compound it differently behind the scenes. AER converts all of that into one number: the rate you'd effectively earn over a year if the interest were compounded and left to accumulate. This calculator takes the AER you enter and works out the correct monthly-equivalent rate mathematically. It does not simply divide your AER by 12, which would overstate how much interest compounds and give you the wrong answer.
Show the technical detail
Formally, AER = (1 + i/n)ⁿ − 1, where i is the account's nominal interest rate and n is how many times a year it compounds. To simulate a savings balance monthly from an AER figure, this calculator inverts that relationship: monthly rate = (1 + AER)^(1/12) − 1. That monthly rate, compounded every month for a year, reproduces the AER you entered exactly. That's the whole point of AER as a standardised, comparable figure.
The monthly-equivalent rate derived from your AER:
monthly rate = (1 + AER) ^ (1/12) − 1
Compounding that monthly rate for 12 months reproduces the AER you entered exactly.
Regular saving
Regular saving makes a difference
How much you deposit regularly usually matters far more to your final balance than small differences in interest rate. Depositing consistently — even a modest amount — means more of your own money is in the account earning interest for longer, on top of whatever your starting balance grows into by itself.
Depositing more often (monthly rather than annually, for example) also helps a little: each deposit starts earning interest sooner, so your money spends more time compounding over the full period.
Thinking about investing rather than a savings account? Use the investment calculator →
Worked example
£1,000 to start, £200 a month, 4% AER
Say you open a savings account with £1,000, add £200 every month, and it pays 4% AER, for 5 years.
- You deposit
- £13,000.00
- Interest earned
- £1,452.46
- Final balance
- £14,452.46
Just over £1,450 of that final balance came from interest alone, without doing anything beyond making the same £200 deposit each month. That's the effect of your rate compounding steadily over five years.
Good to know
What this calculator does, and its limits
What it does
Simulates a savings balance month by month, using the AER, starting balance and deposit amount and frequency you enter, so you can see how your balance and its make-up of deposits vs. interest change over time — and, if you set a goal, whether and when you're on track to reach it.
Assumptions
- Assumes a constant AER for the whole period. Real savings rates can and do change, especially on variable-rate and easy-access accounts.
- Converts your AER into the correct monthly-equivalent rate and applies it every month, regardless of how your deposits are timed.
- Doesn't include tax, fees, or charges. See below for how savings interest is taxed in the UK.
- Assumes every deposit is paid in full, on time, with no withdrawals.
Not financial advice. This is a general information tool, not a personal recommendation. Speak to a regulated financial adviser before making significant savings decisions.
FAQ
Common questions
What does AER mean?
AER stands for Annual Equivalent Rate. UK banks and building societies are required to quote it so savings accounts can be compared fairly, whatever their actual payment frequency or compounding method. It's the rate you'd effectively earn over a year if interest were compounded and left in the account.
How is savings interest calculated?
This calculator converts your account's AER into the correct monthly-equivalent rate — using (1 + AER)^(1/12) − 1, not simply AER ÷ 12 — and applies it to your balance every month. Any deposit due that month is added straight after, so it starts earning interest from the next month onward.
Is savings interest paid monthly or annually?
It depends on the account. Check its terms or key facts document. Some pay monthly, some annually, and some don't pay out but simply add interest to your balance. AER exists precisely so you can compare accounts fairly regardless of how often they actually pay interest.
Does monthly interest earn more than annual interest?
Not if both accounts quote the same AER. That's the point of AER: it already accounts for how often interest compounds. What does make a difference is how often you deposit money: depositing monthly rather than annually means your money starts earning interest sooner, which modestly increases your final balance.
How much should I save each month?
That depends on your own goals, income and expenses, so this calculator can't tell you a right answer. But it can show you the effect of different amounts. Try changing the regular deposit above, or turn on the savings goal toggle to see how long different amounts take to reach a target.
Is savings interest taxable in the UK?
It can be. Most UK savers have a Personal Savings Allowance that lets them earn some interest tax-free each year, with the exact amount depending on their income tax band, and interest earned inside an ISA is tax-free regardless. This calculator doesn't apply any tax to its results; check your own position with HMRC or a tax adviser if it's relevant to you.
Does this calculator include tax?
No. The figures shown are gross: before any tax you might owe on the interest. If you know your interest will be taxed, you can approximate the effect by using a lower interest rate that reflects your after-tax return.
Are these results guaranteed?
No. This calculator assumes a constant AER for the whole period you enter, but real savings rates change, particularly on variable and easy-access accounts. Treat the results as an illustration of how your plan grows at a given rate, not a promise of what you'll actually receive.
Keep exploring
Want to see what else your money could do?
See how the underlying maths works, or what investing instead could grow to.
Compound interest calculator
See how a lump sum and regular contributions grow with compounding interest over time.
Investment calculator
See what a regular investment plan could grow to, including the effect of fees.
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