What does this tool do?
A sinking fund smooths a large expected expense into smaller regular deposits, so the money is ready when the bill arrives. Interest is optional and usually modest for short horizons.
The Formula
Monthly = Gap × r ÷ ((1 + r)^n − 1), where r = annual rate ÷ 12Frequently Asked Questions
What is a sinking fund?
A dedicated savings pot for a known future cost, such as car repairs or a holiday. Regular deposits replace a sudden large bill.
Where should I keep it?
For near-term expenses, prioritise access and capital stability over yield. Match the access date to when the bill is due.