What is a Savings Account Calculator?
A Savings Account Calculator is a powerful financial tool that helps you estimate the future value of your bank deposits with compound interest over time. It shows you exactly how the power of compounding can turn small, consistent investments into substantial wealth over time.
Our advanced Savings Account Calculator includes a compound interest feature, allowing you to model how your regular monthly deposits grow with compound interesthelping you plan for emergency funds and short-term goals.
How Does Savings Account Interest Work?
When you deposit money in a savings account, your bank pays you interest on your balance. Here is what makes savings accounts powerful:
- Compound Interest: Your interest earns interest, accelerating growth over time
- Power of Compounding: Safety: Bank deposits are insured up to Rs 5 lakh by DICGC
- Discipline: Liquidity: Access your money anytime via ATM, UPI, or net banking
- Flexibility: Flexibility: Start with any amount and deposit more whenever you want
Why Use Our Savings Account Calculator?
- compound interest feature: Model annual increases in your SIP amount (10% one-time = wealth acceleration)
- Visual Charts: Beautiful graphs showing your savings growth trajectory
- Realistic Projections: Realistic rates: Based on current Indian bank savings account rates (3-7% p.a.)
- Free & Private: All calculations happen in your browseryour data never leaves your device
Compound Interest Formula
Your savings growth is calculated using the compound interest formula:
FV = P [(1 + r)^n - 1] / r (1 + r)
Where:
- FV = Future Value of investment
- P = Monthly Deposit
- r = Annual interest rate divided by 12 for monthly compounding
- n = Total number of months (Years 12)
Real Example: Example: Building an Emergency Fund
Scenario: You start with 10,000/month SIP, increase it by 10% annually for 15 years at 4% interest rate.
- Starting with Rs 50,000: Total Invested = 18L, Final Value = 50L (approx)
- With 10% annual rate: Total Invested = 32L, Final Value = 88L (approx)
- Benefit: Your money works for you while you sleep!
Savings Account Tips
- Start Early: Even 1,000/month for 25 years beats 5,000/month for 10 years
- Stay Consistent: Set up auto-transfer on salary day to ensure consistent savings
- Compare bank interest rates - small finance banks often offer higher rates
- Choose Right Fund: Keep 3-6 months expenses as emergency fund in savings account
- Review Yearly: Review your savings goals annually and adjust monthly deposits accordingly
Current Savings Account Interest Rates in India (2025)
Savings account interest rates vary significantly across different types of banks. Here is a comparison to help you choose wisely:
- Public Sector Banks (SBI, PNB, BOB): 2.70% - 3.00% per annum
- Private Banks (HDFC, ICICI, Axis): 3.00% - 3.50% per annum
- Small Finance Banks (AU, Equitas, Ujjivan): 5.00% - 7.00% per annum
- Digital Banks (Jupiter, Fi, Niyo): 3.00% - 6.00% per annum
- Senior Citizen Accounts: Additional 0.50% - 1.00% above regular rates
Building an Emergency Fund with Your Savings Account
An emergency fund is your financial safety net. Here is how to build one effectively:
- Calculate Your Monthly Expenses: Include rent, EMIs, groceries, utilities, and insurance premiums
- Set Your Target: Aim for 3-6 months of expenses (more if you have dependents or variable income)
- Automate Your Savings: Set up standing instructions to transfer money on salary day
- Keep It Accessible: Use a separate savings account for your emergency fund
- Review Periodically: Adjust your emergency fund as your expenses change
Savings Account vs Fixed Deposit: When to Choose What
Understanding when to use savings accounts versus fixed deposits helps optimize your returns:
- Use Savings Account for: Emergency funds, short-term goals under 6 months, money you may need anytime
- Use Fixed Deposit for: Goals 1-5 years away, surplus funds you will not need immediately, higher interest rates
- Consider Sweep Accounts: Automatically moves excess balance to FD for higher returns while maintaining liquidity