Israel Keren Hishtalmut Calculator: Study Fund Growth
Estimate what an Israeli keren hishtalmut (study/training fund) grows to from regular monthly contributions — a medium-term savings vehicle prized for combining employer matching, a tax-deductible/exempt contribution, and tax-free growth on withdrawal.
Adjust the inputs and select Calculate for a full breakdown.
Year-by-year growth schedule
Compare Common Scenarios
How the numbers shift across typical situations for this calculator:
| Scenario | Future value | Total contributions | Total interest earned |
|---|---|---|---|
| ₪2.5k/mo · 5% · 6yr (naziel) | $209,410.65 | $180,000.00 | $29,410.65 |
| ₪1.5k/mo · 5% · 10yr | $232,923.42 | $180,000.00 | $52,923.42 |
| ₪50k + ₪3k/mo · 6% · 6yr | $330,828.78 | $266,000.00 | $64,828.78 |
| ₪2k/mo · 4% · 15yr | $492,180.98 | $360,000.00 | $132,180.98 |
How This Calculator Works
Enter your current hishtalmut balance, the total monthly contribution (employee + employer), the return you expect, and the years contributing. The calculator compounds the balance monthly and shows the projected value and the growth. The hishtalmut becomes withdrawable tax-free after six years; many Israelis treat it as their best supplementary savings account thanks to the unique mix of benefits.
The Formula
Future Value with Regular Contributions
P = starting amount, PMT = monthly contribution, r = monthly rate (annual ÷ 12), n = number of months
Worked Example
₪2,500 a month for 6 years at 5% grows to about ₪209,411, with roughly ₪29,411 of that being tax-free growth (within the salary-cap rules). The keren hishtalmut ('study fund' / 'training fund') is one of Israel's most attractive savings products. For salaried workers, the employee typically contributes 2.5% of salary and the employer 7.5% — so two-thirds of the inflow is from the employer. Contributions on salary up to the regulated cap are tax-deductible/exempt going in, the fund grows tax-deferred, and after six years the entire balance — including the gains — can be withdrawn fully tax-free.
Key Insight
The keren hishtalmut is widely considered the best tax-advantaged liquid savings vehicle in Israel, and a few features explain why. The contribution structure is the headline: for employees the typical split is 2.5% from the worker and 7.5% from the employer (the maximums most commonly used), so two-thirds of the monthly inflow is 'free money' from the employer — the equivalent of a substantial pay rise that goes straight into savings. Tax going in: contributions on salary up to the regulated ceiling (the tikra) are tax-favoured — the employee's share is deductible and the employer's contribution isn't treated as taxable salary, within the cap. Tax during: gains compound tax-deferred. Tax going out: after six years the fund becomes 'naziel' (liquid) and the entire balance — including all investment gains — can be withdrawn completely tax-free, an unusually generous treatment for a non-pension vehicle that you can also access early on grounds like funding professional training. Self-employed Israelis can also open a hishtalmut and contribute up to a defined percentage of net business income, deductible within an annual cap. Three caveats this estimate doesn't model: the salary cap (contributions above it remain allowed but lose the tax break), fund fees (management fees on the wrapper and inside the investment track compound over years, so low-cost tracks are favoured), and the fact that taking the fund out at six years 'resets' the clock for a new fund — many savers leave the money in past six years to keep compounding tax-free for as long as they need it. This calculator gives a gross, constant-return projection on whatever monthly inflow you enter; in practice optimise by using the full employer match, stay within the salary cap to keep the tax benefits, and pick a low-cost track aligned with your horizon.
Frequently Asked Questions
How is keren hishtalmut growth calculated?
Your balance and monthly contributions (employee + employer) compound at the expected return (annual rate ÷ 12 per month). ₪2,500/month for 6 years at 5% grows to about ₪209,411, with roughly ₪29,411 of tax-free growth — before fund fees and assuming you stay within the salary cap.
What is a keren hishtalmut?
Israel's 'study fund' or 'training fund' — a medium-term savings vehicle with major tax benefits. Employees typically contribute 2.5% of salary with the employer adding 7.5%. Contributions within the salary cap are tax-favoured, gains grow tax-deferred, and after six years the entire balance is withdrawable tax-free.
Why is the hishtalmut so attractive?
Three reasons: a large employer match (typically 7.5% of salary, three times the employee's 2.5%), tax-favoured contributions within the salary cap, and — uniquely — completely tax-free withdrawal (gains included) after six years. The combination of free employer money plus tax-free growth is rare for a liquid savings product.
What is the six-year rule?
After six years from the fund's opening (or first contribution, depending on the rules), the entire balance becomes 'naziel' — fully liquid and tax-free to withdraw. Many savers leave the money invested past six years to keep enjoying tax-free growth; withdrawing earlier than six years is generally taxable except in specific cases.
Can self-employed people open one?
Yes — self-employed Israelis can open a keren hishtalmut and contribute up to a defined percentage of net business income, deductible within an annual cap. The structure is slightly different from the employee version but offers similar tax-favoured contributions and tax-free withdrawals after the qualifying period.
Related Calculators
Methodology & Review
The future value compounds a starting balance plus a fixed monthly contribution at the annual return, compounded monthly. It assumes a constant return and end-of-month deposits, and does not enforce the salary cap up to which contributions are tax-advantaged, model fees, or compute capital-gains tax on growth beyond the exempt portion.
Written by Ugo Candido · Last updated May 22, 2026.