How the Money Market Account Calculator works
A money market account (MMA) is a deposit account that pays interest and typically compounds it on a regular schedule — daily, monthly, quarterly, or annually depending on the bank. This calculator projects how a balance grows when you start with an opening deposit, add a regular deposit each period, and let interest compound at your chosen frequency for a set number of years.
The formula
For an opening deposit P, a periodic interest rate i (the annual rate divided by the number of compounding periods per year), a total of N periods (years × periods per year), and a deposit PMT added at the end of each period, the ending balance is:
FV = P(1 + i)N + PMT × [((1 + i)N − 1) / i]
The first term is ordinary compound interest on the opening deposit; the second term is the future value of an ordinary annuity — the growing sum of every regular deposit compounding for the time it remains in the account. If the rate is 0%, the second term reduces to PMT × N (deposits with no interest).
Worked example
Take a $10,000 opening deposit, a $200 deposit added every month, a 4.5% annual rate, monthly compounding, over 5 years. The periodic rate is 0.045 / 12 = 0.00375 and N = 60 periods. The formula gives an ending balance of about $25,947. Total deposits over the period are $10,000 + ($200 × 60) = $22,000, so interest earned is roughly $3,947 — about 15% of the final balance. Because interest compounds monthly rather than once a year, the effective annual percentage yield (APY) works out to about 4.59%, slightly above the 4.5% nominal rate entered.
Why APY differs from the interest rate
Banks advertise money market accounts using APY — the effective annual return after compounding — rather than the plain nominal rate. The two match only when interest compounds once a year. Compounding monthly, quarterly, or daily lets each period's interest start earning interest sooner, so the APY works out a little higher than the nominal rate: APY = (1 + i)n − 1, where n is the number of compounding periods per year. The calculator reports this figure alongside the projected balance.
What moves the balance most
- Time in the account: compounding needs time to compound. Doubling the term does more than double the interest earned, because later deposits and earlier interest both keep compounding longer.
- Regular deposits: consistent deposits usually contribute more to the ending balance than interest does, especially over shorter terms or at lower rates.
- Rate and compounding frequency: a higher nominal rate raises every period's interest; more frequent compounding raises the effective APY slightly, though the effect is small at typical savings rates.
Assumptions and limits
This is a projection, not a guarantee. It assumes one fixed interest rate for the full term, deposits made at the end of each period, and no withdrawals, fees, or minimum-balance penalties. Real money market accounts often carry variable or tiered APY that changes with the balance or with market conditions, and some require a minimum balance to earn the advertised rate or to avoid a monthly fee. Use this calculator to compare scenarios and see the mechanics of compounding — not as a guaranteed forecast of what any specific account will pay. This tool provides mathematical estimates only and is not personalized financial advice.