What is the Interest-Only Savings Income Calculator?
This calculator shows how much regular income a lump sum of savings can produce if you live off the interest alone and never touch the original capital. It is ideal for retirees, savers building passive income, or anyone weighing how much they would need to deposit to reach a target monthly payout.
How to use it
Enter your total savings or principal amount and the annual interest rate offered by your account or investment. The calculator instantly returns your monthly, weekly, daily and annual interest income. Because only the interest is withdrawn, your principal stays the same year after year (assuming the rate holds).
The formula explained
The core equation is simple:
$$\text{Monthly Income} = \frac{\text{Principal} \times \dfrac{\text{Rate (\%)}}{100}}{12}$$First the percentage rate is converted to a decimal (5% becomes 0.05). Multiplying by the principal gives the annual interest, and dividing by 12 spreads it across each month. Weekly and daily figures divide the annual interest by 52 and 365 respectively.
Worked example
Suppose you have $100,000 saved at a 5% annual rate. Annual interest = \(100{,}000 \times 0.05 = \$5{,}000\). Monthly income = \(5{,}000 \div 12 \approx \$416.67\). Weekly income = \(5{,}000 \div 52 \approx \$96.15\), and daily income = \(5{,}000 \div 365 \approx \$13.70\) — all while the $100,000 remains untouched.
FAQ
Does this account for compounding? No. It assumes you withdraw all interest as income, so the balance does not grow or shrink. If you reinvest interest instead, use a compound interest calculator.
Is the income guaranteed? Only if your rate is fixed. Variable savings rates change over time, which will raise or lower your income accordingly.
Are taxes included? No. Interest income may be taxable depending on your jurisdiction; the figures shown are gross (before tax).
