How the reverse calculation works
First, the starting amount is projected on its own: $10,000.00 at a hypothetical 7%, compounded annually for 20 years, becomes $38,696.84. Whatever gap remains between that figure and your $100,000.00 target must be filled by monthly deposits plus the interest those deposits earn along the way. The calculator divides the gap by the annuity factor — the accumulated value of $1 deposited at the end of every month — to get the monthly amount. With the defaults above, the answer is $120.79 a month.
Two consequences are worth noticing. Starting earlier shrinks the monthly deposit far more than saving harder later, because early deposits have more years to compound. And the assumed rate does heavy lifting: drop it and the required deposit rises quickly, because less of the gap is covered by interest. Play with the rate to see how sensitive your plan is to the assumption — a plan that only works at an optimistic rate is a fragile plan.
Frequently asked questions
What if my starting amount already covers the goal?
Then the required monthly deposit is $0 — the calculator checks whether the starting amount, grown at your assumed rate, already meets or passes the target.
What if the rate is 0%?
The maths reduces to simple division: the gap between target and starting amount, spread evenly over the months. No interest helps, so the deposit is at its highest.
Are deposits assumed at the start or end of the month?
End of month, the same convention as the main compound interest calculator, so results from the two tools agree with each other.
Can I use this for a house deposit or a car?
The arithmetic is the same for any target. Just remember the result is a smooth-rate estimate; an actual savings account rate will differ and can change over time.