Finance

What a savings account actually pays

Calculated the way banks really do it: interest on your daily balance, credited monthly - not an investment-style annual growth rate. Model a bonus rate that reverts to an ongoing rate, since that is how most high-interest savings accounts are actually structured.

Currency symbol (display only - doesn\'t change the numbers)

Starting balance

The balance already sitting in this account today, before anything else is added.

Monthly deposit

How much you plan to add every month, from now until the end of your timeline below.

Monthly withdrawal (leave at 0 if you are not touching it)

Most savings projections quietly assume you never take anything out. If you do dip in - even a small regular amount - it costs you more than the money withdrawn, because that money stops earning too. Put a figure here and the result shows both effects separately.

Savings goal (optional - leave at 0 to skip)

A house deposit, an emergency fund, a trip. Enter the number you are aiming at and the result tells you when you reach it - and whether your timeline below is long enough.

Inflation, for the real-terms view (% a year)

Used only for the "today's money" toggle in the result. It does not change the balance itself - it changes what that balance would actually buy.

Compare against another account (% a year) (optional - leave at 0 to skip)

Seen a better rate somewhere else? Put it here and the result shows what the difference is actually worth over your timeline - which is usually less dramatic than the rate gap suggests, and occasionally more.

Why rate periods? Most high-interest savings accounts pay a bonus rate for an introductory period, then revert to a lower ongoing rate - a common real structure, not a hypothetical one. Set up to 3 rate periods if your account works that way: an intro period, an ongoing period, and a third if the rate changes again. Stick with 1 period for a simple flat-rate account.

1 rate period

2 rate periods

3 rate periods

How this is actually calculated

Real savings accounts do not compound to a target annual figure the way an investment return does. Banks calculate interest daily on your closing balance - daily interest = balance × (annual rate ÷ 365) - then credit the accumulated amount to your account, usually monthly. Because that credited interest then earns interest itself the following month, the account effectively compounds monthly as a side effect, not because the bank applied a monthly-compounding formula directly.

That distinction matters: it means the rate printed on your account (the nominal rate) and what you actually earn over a year (the effective annual yield) are not quite the same number - the effective yield ends up very slightly higher, purely from that monthly reinvestment. This calculator applies the nominal rate you enter using the real daily-accrual method, the same way the numbers on your actual statement would be worked out.

This isn't the retirement calculator, and here's the real difference

Both tools show a balance growing over time, which can make them look interchangeable. They are not modelling the same thing. A savings account is a bank deposit with a rate that is fixed or variable but always known in advance, calculated daily, and usually accessible whenever you want it. Money in shares, a managed fund, or a retirement account is market-linked - the return is not a quoted rate but a long-run average of gains that vary year to year, often locked away for decades, which is why inflation and multi-decade staging matter there in a way they don't for a one-to-five-year savings goal.

Use this page for a bank account, an emergency fund, or a house deposit - somewhere you can name the actual interest rate. Use the retirement calculator for market-linked, multi-decade growth, career-break stages, and what the balance is really worth after inflation - a genuinely different set of questions.

Verified against a real published example: Mozo's own worked example for a $10,000 balance at 4.8% p.a. gives $1.32 of interest in a day and $39.45 across a 30-day month - this calculator's daily-accrual formula reproduces both figures exactly.