Save now vs. save later

A penny saved is a penny earned, but a penny saved today is a penny earning more. It is important to start saving as soon as possible for events such as retirement due to the impact of compounding. If you start saving now you will need to save considerably less than if you wait a few years. Use this calculator to determine how much extra you will need to save if you wait.

Savings

Current age ?

Your age today, the starting point for the comparison.

Age when funds are needed ?

The age by which the future amount must be available.

Future amount needed ?

The total sum you want to have by that age.

Assumptions

Advanced options 2

Before-tax return ?

The annual growth rate assumed on savings before taxes.

Table of Historic Rates of Return. Inflation 2.9%, U.S. Treasury Bills 3.3%, Long-term Government Bonds 5.0%, U.S. Large-Company Stocks 10.4%, and U.S. Small-Company Stocks 11.8%. Past performance is no guarantee of future results. Source: Ibbotson SBBI 1926-2024

Marginal tax bracket ?

Your tax rate, used to translate the before-tax return into an after-tax one.

Table of Federal Income Brackets and Rates. Tax Rate For Single Filers For Married Individuals Filing Joint Returns For Heads of Households 10% $0 to $11,925 $0 to $23,850 $0 to $17,000 12% $11,925 to $48,475 $23,850 to $96,950 $17,000 to $64,850 22% $48,475 to $103,350 $96,950 to $206,700 $64,850 to $103,350 24% $103,350 to $197,300 $206,700 to $394,600 $103,350 to $197,300 32% $197,300 to $250,525 $394,600 to $501,050 $197,300 to $250,500 35% $250,525 to $626,350 $501,050 to $751,600 $250,500 to $626,350 37% $626,350 or more $751,600 or more $626,350 or more.

Enter your values and select Calculate.

The difference figure is the extra amount you would have to set aside in total if you put off starting, compared with beginning today. It is not a prediction of what will happen to your money — it is a measure of how much more work delay creates, given the return and tax assumptions you entered. There is no single 'right' number here, only a clearer picture of the tradeoff between starting now and starting later.

The result is most sensitive to the age when funds are needed and the before-tax return you assume. A higher assumed return shrinks the gap between saving now and saving later, because compounding does more of the work either way; a longer runway to the target age does the same. Small changes to either input can move the required monthly or lump-sum savings by a meaningful amount, so it is worth testing a few scenarios rather than trusting one static run.

The model does not account for inflation eroding the future amount needed, changes in your tax bracket over time, market returns that vary year to year instead of compounding smoothly, or life events that change how much you can actually save. Treat the output as a planning estimate, not a guarantee of what you will need or earn.

Revisit this calculator whenever your return assumptions change, you get a raise that lets you save more, or your target date or target amount shifts. If the gap between saving now and saving later looks large, that is worth bringing to a financial advisor rather than acting on the number alone. Having a concrete estimate at all puts you ahead of guessing, and even modest early contributions compound in your favor over time.

This information may help you analyze your financial needs. It is based on information and assumptions provided by you regarding your goals, expectations and financial situation. The calculations do not infer that the company assumes any fiduciary duties. The calculations provided should not be construed as financial, legal or tax advice. In addition, such information should not be relied upon as the only source of information. This information is supplied from sources we believe to be reliable but we cannot guarantee its accuracy. Hypothetical illustrations may provide historical or current performance information. Past performance does not guarantee nor indicate future results.