Calculate the current estimated value of your MMA account based on your initial deposit and growth over time.
Estimated MMA Account Value
Understanding Your MMA Account Value
A Money Market Account (MMA) is a type of savings account that typically offers higher interest rates than traditional savings accounts, while still providing easy access to your funds. The value of your MMA grows over time due to the principal amount, any additional contributions you make, and the interest earned on the balance.
How the MMA Account Value Calculator Works
This calculator estimates the future value of your MMA account by taking into account:
Initial Deposit: The lump sum amount you start with.
Monthly Contributions: Regular deposits you plan to make.
Estimated Annual Interest Rate: The projected annual percentage yield (APY) your MMA will earn.
Number of Years: The duration over which you want to project the growth.
The Underlying Calculation
The calculator employs a compound interest formula, adjusted for regular contributions. It essentially calculates the future value of the initial deposit compounded over the specified period, and then adds the future value of an ordinary annuity for the monthly contributions. The formula can be broken down as follows:
1. Future Value of Initial Deposit (FV_principal):
FV_principal = P * (1 + r/n)^(nt)
P = Initial Deposit
r = Annual Interest Rate (as a decimal)
n = Number of times interest is compounded per year (we assume daily compounding for accuracy, so n=365)
t = Number of years
2. Future Value of Monthly Contributions (FV_annuity):
FV_annuity = M * [((1 + r_m)^N - 1) / r_m]
M = Monthly Contribution
r_m = Monthly Interest Rate (r/12)
N = Total number of contributions (Number of Years * 12)
Total Future Value = FV_principal + FV_annuity
Note: For simplicity and practical estimation, this calculator uses daily compounding for the principal and calculates the annuity based on monthly compounding, which is a common and effective way to estimate MMA growth. The actual compounding frequency and calculation methods by financial institutions may vary slightly.
Use Cases
Financial Planning: Estimate how much you might have in your MMA for future goals like a down payment, emergency fund, or a large purchase.
Savings Goal Setting: Determine how consistent contributions and realistic interest rates can help you reach specific savings targets.
Comparing Accounts: Understand the potential growth of your money in an MMA compared to other savings vehicles.
By inputting your details, this calculator provides a clear projection to help you make informed financial decisions.
function calculateMMAAccountValue() {
var initialDeposit = parseFloat(document.getElementById("initialDeposit").value);
var monthlyContributions = parseFloat(document.getElementById("monthlyContributions").value);
var annualInterestRate = parseFloat(document.getElementById("annualInterestRate").value);
var numberOfYears = parseInt(document.getElementById("numberOfYears").value);
var resultDiv = document.getElementById("result");
var resultValueDiv = document.getElementById("result-value");
if (isNaN(initialDeposit) || isNaN(monthlyContributions) || isNaN(annualInterestRate) || isNaN(numberOfYears) ||
initialDeposit < 0 || monthlyContributions < 0 || annualInterestRate < 0 || numberOfYears 0) {
fv_annuity = monthlyContributions * (Math.pow(1 + monthlyRate, numberOfMonths) – 1) / monthlyRate;
} else {
// If rate is 0, it's just the sum of contributions
fv_annuity = monthlyContributions * numberOfMonths;
}
var totalFutureValue = fv_principal + fv_annuity;
resultValueDiv.innerHTML = "$" + totalFutureValue.toFixed(2);
resultDiv.style.display = 'block';
}