# Savings Calculator

**Disclaimer:** Whilst every effort has been made in building these savings calculators, we are not to be held liable for any special, incidental, indirect or consequential damages or
monetary losses of any kind arising out of or in connection with the use of them. Full disclaimer. These tools are
here purely as a service to you, please use them at your own risk.

## How to calculate your savings growth

Our simple **savings calculator** helps you project the growth and future value of your money over time. It uses the compound interest formula, giving options for
daily, weekly, monthly, quarterly, half yearly and
yearly compounding. If you want to know the compound interval for your savings account or investment, you should be able to find out by speaking to your
financial institution. The standard interval for compounding savings with most banks appears to be either monthly or yearly compounding. Our savings calculator also allows
you to enter **negative interest rates**.

In addition to this savings calculator, we have another useful compound interest calculator, should you wish to use it. If you are looking to save towards a goal and want to know how long it might take, give the savings goal calculator a try.

### What is the effective annual rate?

The effective annual rate is the rate that actually gets paid after all of the compounding. When compounding of interest takes place, **the effective annual rate becomes higher
than the overall interest rate**. The more times the interest is compounded within the year, the higher the effective annual rate will be. You can learn more about
effective annual interest rates in our article here.

## What is the best way to save?

Whether you've got a specific savings goal in mind - from a new car, perfect holiday, the home of your dreams or for your retirement,
it can be tricky to work out where to put your money to **maximise your savings**.

With so many options available for your savings - from a simple savings account to investing in the stock market, tax-free ISAs (UK) and IRAs (US) and even peer-to-peer lending - comparing the advantages and disadvantages of each, and the risks involved, becomes very important.

It's always advisable, in a situation like this, to assess yourself as a person - are you risk averse or do you prefer a more high risk, high reward strategy? Consideration should be given to the idea of diversification - splitting your money between various options in order to spread your risk.

The best advice remains, however, to speak to a qualified, independent financial advisor. They will assess your options based upon who you are and what you want to achieve. By doing this you feel more assured that your savings are invested well and that you have savings options personally tailored to your requirements and risk/reward strategy.

## How long do you need to save for?

If you're wondering how long it might take you to save towards a specific goal, check out our calculator and article: how long will it take me to save?.

## Financial Independence, Retire Early (FIRE)

FIRE (Financial Independence, Retire Early) is a lifestyle movement that looks to adopt strategies of frugality, extreme saving and investment in order to achieve financial independence and early retirement. Originally discussed in the 1992 book "Your Money or Your Life" by Vicki Robin and Joe Dominguez, the concept has become increasingly popular among millennials. You can read more about the concept of FIRE here.

If you're interested in the idea of retiring early, our savings calculator can help you work out forecasts on how to achieve the goals you want to hit.