See exactly how your savings grow over time. Enter your starting balance, monthly contributions and interest rate to get a full year-by-year projection — and watch compounding do its work.
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Savings growth is driven by three inputs: your starting balance, how much you add regularly and the interest rate. But the magic fourth factor is time — specifically, compound interest turning your earned interest into principal that itself earns interest. Our calculator shows this acceleration year by year, making the case for starting early far more compelling than any financial advice can.
Starting 10 years later with the same monthly contribution and same rate produces a dramatically smaller pot. At £200/month at 5% AER: starting at 25 gives £323,000 by 65. Starting at 35 gives £180,000. The 10-year delay costs £143,000 despite only £24,000 less being deposited. The compounding on the earlier years is irreplaceable.
Divide 72 by your interest rate to estimate how many years it takes to double your money. At 4.5% AER: 72 ÷ 4.5 = 16 years to double. At 7%: 72 ÷ 7 = just over 10 years. A quick mental tool for comparing savings and investment options.
Regular monthly contributions (pound-cost averaging) smooth out the timing risk and build the savings habit. A lump sum invested earlier benefits from more compounding time. Our calculator handles both — set monthly contributions to zero for lump sum, or starting balance to zero for pure regular saving.
Most UK savings accounts compound monthly or annually. Monthly compounding means interest is added to your balance each month, which then earns interest itself the following month. This produces slightly more than the same rate compounded annually. Our calculator lets you choose the compounding frequency to match the exact account you are evaluating.
AER (Annual Equivalent Rate) is the UK's standardised savings rate that accounts for compounding frequency. A 4.8% gross rate compounded monthly has an AER of 4.91%. Always compare accounts by AER — it is the legally required comparison metric and ensures a like-for-like comparison regardless of how often accounts compound.
Savings growth uses the compound interest formula A = P(1 + r/n)^(nt) + monthly_contribution × ((1 + r/n)^(nt) - 1) / (r/n). In plain English: your starting balance and each monthly deposit earns interest, and that interest itself earns interest over time. The result accelerates non-linearly — early deposits earn compound interest on all future periods.
In 2026, easy-access savings accounts pay 4.3–5.0% AER, fixed-rate bonds pay 4.8–5.5% AER for 1–2 year terms, and regular saver accounts can pay 5–7% AER for monthly deposits up to a set limit. For long-term projections beyond 5 years, 4–5% is a realistic assumption unless investing in assets with higher but less certain returns.
Basic-rate taxpayers with under £20,000 in savings at 5% AER stay within the £1,000 Personal Savings Allowance — a standard account is fine. Higher-rate taxpayers (40%) with a £500 PSA should prioritise a Cash ISA for savings likely to generate over £500/year in interest. At 5% AER, that threshold is reached at £10,000.
A common guideline is 20% of take-home pay (the 50/30/20 rule). More practically: fully fund an emergency fund (3–6 months expenses) first, then maximise pension contributions up to any employer match, then ISA allowance. Use our Monthly Savings Planner to work backwards from a specific goal.