Sinking Fund Calculator (VND)
Some large costs are not surprises at all — you know both the amount and the date well in advance: flights home for the holidays, a work-permit or visa renewal, a TET bonus you want to set aside, a deposit on a new apartment, annual insurance premiums, or school fees for the next term. A sinking fund is simply the discipline of breaking one known future expense into equal monthly chunks, so that when the bill arrives you already have the cash — no scrambling, no high-interest borrowing, no breaking a long-term deposit early.
This is what separates a sinking fund from the other two pots people confuse it with. An emergency fund covers the unexpected and has no due date. An open-ended savings goal may have a target but no firm deadline. A sinking fund has both a fixed amount and a fixed date, so the calculation always reduces to one question: how much per month? The base formula is (target − already saved) ÷ months. Worked example: to have 120.000.000 VND in 18 months, with 20.000.000 VND already put aside, you set aside 5.555.556 VND/month.
If you keep the fund somewhere that earns interest — a savings account or a short term deposit — the interest does a little of the work, so the required monthly amount drops slightly. Under an illustrative 4%/year assumption, the figure falls to 5.319.672 VND/month, about 235.883 VND less each month. One caveat for everything on this page: the 4%/year rate is an illustrative assumption, not a quote. Real VND rates vary by bank, tenor and date — enter your own rate in the calculator.
How the sinking fund is calculated
The base formula (no interest)
This is the headline number the calculator shows. It is easy to verify and always safe because it does not rely on any interest assumption:
Monthly set-aside = (Target amount − Already saved) ÷ Months remaining
| Symbol | Meaning |
|---|---|
| Target | Total amount you need by the due date |
| Already saved | What you have already put aside for this specific goal |
| Months | Number of months from now until the deadline |
For the example — 120.000.000 VND target, 20.000.000 VND already saved, 18 months to go: (120.000.000 − 20.000.000) ÷ 18 = 5.555.556 VND/month. Over 18 months you contribute 100.000.000 VND of your own money, which plus the 20.000.000 VND you started with lands exactly on 120.000.000 VND.
The interest-aware version
When the fund earns interest, the calculator solves for the level monthly payment (PMT) such that the already-saved amount (grown at the rate) plus the stream of deposits — each made at the start of the month so it earns interest that month — hits the target on the due date:
Already saved × (1 + r)^m + PMT × ((1 + r)^m − 1)/r × (1 + r) = Target
where r is the effective monthly rate = (1 + annual rate)^(1/12) − 1 and m is the number of months. Every figure in the worked example comes from this formula, so you can reproduce it in the widget or a spreadsheet. Because sinking funds usually run for only a few months to a couple of years, the interest contribution is modest — do not count on it to carry the load.
Sinking fund vs emergency fund
- Sinking fund: for a known expense with a known date — a flight, a renewal fee, school fees, a wedding, an annual premium. It is designed to be spent on a specific date.
- Emergency fund: for the unexpected — job loss, medical bills, a major repair. Usually 3–6 months of expenses that you try not to touch.
Keep them in separate accounts so the holiday-flights money never quietly becomes the medical-bill money.
What the model leaves out
The calculator assumes you contribute on schedule, a constant rate for the whole period, and ignores taxes, fees and price inflation. If the target cost itself might rise (airfares, tuition), pad the target a little to build in a safety margin.
Worked example: a 60.000.000 VND target with nothing saved yet, across deadlines
Illustrative assumptions: a 4%/year rate if the fund earns interest, contributions at the start of each month. Picture a foreigner saving for, say, return flights plus a work-permit renewal. The same target spread over different deadlines produces very different monthly amounts — the longer the runway, the lighter each month:
| Deadline | Monthly (no interest) | Monthly (with 4% interest) | Total you pay in (no interest) |
|---|---|---|---|
| 6 months | 10.000.000 | 9.886.104 | 60.000.000 |
| 12 months | 5.000.000 | 4.894.586 | 60.000.000 |
| 18 months | 3.333.333 | 3.230.960 | 60.000.000 |
| 24 months | 2.500.000 | 2.399.307 | 60.000.000 |
Read it as a set of levers. If 5.000.000 VND/month over 12 months is too steep, you can lengthen the runway (24 months brings it down to 2.500.000 VND/month), lower the target, or seed the fund with a starting amount. The interest column shows how little interest helps on a short horizon: at 12 months it shaves the monthly figure from 5.000.000 to only 4.894.586 VND.
If you are also building a buffer for the unexpected, treat that separately — FiMo's emergency fund tool sizes 3–6 months of expenses, while the savings goal tool handles longer, open-ended targets. The sinking fund sits between them: a fixed amount, a fixed date.
Frequently asked questions
What is a sinking fund and how is it different from saving in general?
A sinking fund is money set aside monthly for a specific known expense with a specific date — flights home, a visa renewal, a wedding, tuition, an annual premium. Unlike general saving, it has both a fixed target and a fixed deadline, so the monthly amount is exact: to reach 120.000.000 VND in 18 months with 20.000.000 VND already saved, you set aside 5.555.556 VND/month.
How do I calculate the monthly amount for a sinking fund?
Use (target − already saved) ÷ months remaining. Example: a 120.000.000 VND target, 20.000.000 VND saved, 18 months left → (120.000.000 − 20.000.000) ÷ 18 = 5.555.556 VND/month. If the fund earns interest (illustrative 4%/year), the calculator solves an annuity so the required amount falls to about 5.319.672 VND/month.
Sinking fund vs emergency fund — which do I need?
Both, for different jobs. A sinking fund targets a known cost with a due date and is meant to be spent on that date. An emergency fund covers the unexpected (job loss, medical bills), typically 3–6 months of expenses you try not to touch. Keep them in separate accounts. FiMo's emergency fund tool sizes the buffer; this tool plans the dated expense.
Where should I keep a sinking fund in Vietnam?
Because the money has a fixed spend date, prioritise safe access on time over the highest rate. Common choices: an online savings account, or a term deposit whose tenor matches your deadline so you are not forced to break it early (early withdrawal usually drops you to a near-zero demand rate). On short horizons interest barely moves the needle — in the 18-month example it only trims the monthly amount from 5.555.556 to 5.319.672 VND.
What if the monthly contribution is too high for my budget?
You have three levers: extend the deadline, lower the target, or add a starting amount. For a 60.000.000 VND goal saved from zero, 12 months needs 5.000.000 VND/month, but stretching to 24 months drops it to 2.500.000 VND/month. Try each option in the calculator and watch the figure update instantly.
Is the 4%/year rate in the examples a real Vietnamese bank rate?
No. The 4%/year used throughout this page is an illustrative assumption to keep the math easy to follow. Actual VND deposit rates vary by bank, tenor and date. More importantly, the headline figure for a sinking fund is the no-interest calculation — it is always safe because it does not depend on any rate. Enter your own rate if you want to model the interest effect.
Can I run several sinking funds at once?
Yes — give each goal its own target and date, compute each with (target − already saved) ÷ months, then add the monthly amounts to see the total drain on your income. If the combined figure is unaffordable, fund the nearest deadline first and stagger the others. Many people run parallel sinking funds for flights, insurance renewals and the holidays simultaneously.