How much should I save monthly for education?
Set a target education fund, see exactly how much to save each month — and what happens if you delay.
How the math works
Instead of projecting what a contribution grows to, this tool solves the future-value-of-annuity formula backward: PMT = (FV − PV×(1+r)ⁿ) × r ÷ ((1+r)ⁿ − 1). Starting from $5,000 saved, a $100,000 target in 15 years at a 6% assumed return requires saving roughly $302/month. Existing savings compound over the full horizon before the target date, which is why a larger head start reduces the required monthly payment by more than its face value alone would suggest.
Shortening the time horizon increases the required payment non-linearly — less time means less room for compound growth to help, so more of the target has to come from direct contributions.
Where this doesn't apply
- Education costs often rise faster than general inflation — adjust your target amount upward if you expect that.
- Investment returns aren't guaranteed; a near-term fixed-deadline goal often warrants a more conservative allocation as the date approaches.
- This targets a single lump sum, while real education costs are typically paid across several years of schooling.