Money Market Fund Calculator: What Your Cash Grows To
Work out what a money market fund grows to from a starting balance plus regular monthly deposits — a low-risk, liquid place to hold cash and earn a yield close to short-term interest rates.
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 |
|---|---|---|---|
| $10k + $500/mo · 4% · 5yr | $45,359.46 | $40,000.00 | $5,359.46 |
| $25k + $0/mo · 5% · 3yr (parked cash) | $29,036.81 | $25,000.00 | $4,036.81 |
| $0 + $1,000/mo · 4.5% · 2yr | $25,064.03 | $24,000.00 | $1,064.03 |
| $50k + $0/mo · 4% · 1yr | $52,037.08 | $50,000.00 | $2,037.08 |
How This Calculator Works
Enter your starting balance, monthly deposit, the fund's annual yield, and the years. The calculator compounds the balance monthly and shows the ending value and how much is earnings. Money market funds aim to keep a stable value while paying a yield that tracks short-term rates.
The Formula
Future Value with Regular Contributions
P = starting amount, PMT = monthly contribution, r = monthly rate (annual ÷ 12), n = number of months
Worked Example
A $10,000 starting balance plus $500 a month for 5 years at 4% grows to about $45,359 — with roughly $5,359 of that being earnings. Money market funds are a low-risk place to park cash — they invest in very short-term, high-quality debt and aim to maintain a stable share price — paying a yield that closely tracks short-term interest rates. They're popular for emergency funds, the cash portion of a portfolio, and money awaiting investment, offering more yield than a checking account with high liquidity.
Key Insight
Money market funds sit between a savings account and bond investments, and understanding what they are (and aren't) matters. They're mutual funds that invest in very short-term, high-quality debt (Treasury bills, commercial paper, repos) and aim to maintain a stable $1.00 share price, paying a yield that tracks short-term rates — so the yield is variable and this projection is an estimate, not a guarantee (it can rise or fall as rates move). Important distinctions: a money market fund is an investment product (offered by brokerages/fund companies) and is not the same as a money market deposit account at a bank — the bank account is FDIC-insured, while a money market fund is not FDIC-insured (though it's considered very low-risk, money market funds can in rare crises 'break the buck' or impose redemption gates, so it's not risk-free like an insured deposit). For most savers the practical role is the same as high-yield savings: a liquid, low-risk home for cash earning a competitive yield. A few notes: the income is taxable (some funds hold government or municipal securities for tax advantages — government money market funds and tax-exempt funds exist), fund expense ratios reduce the net yield (favor low-cost funds), and the yield, while solid, typically trails long-term investment returns — so it's for safety and liquidity, not long-term growth. Use it for emergency funds, near-term goals, and idle cash, and invest money with a long horizon elsewhere.
Government vs prime money market funds
Two main MMF categories. GOVERNMENT MONEY MARKET FUNDS (Vanguard Federal MMF VMFXX, Fidelity Government MMF FZFXX, Schwab Government Money Fund SWGXX) — invest in Treasury bills, government securities, repos backed by Treasuries. Lower credit risk; daily NAV close to $1.00 with high stability.
PRIME MONEY MARKET FUNDS (Vanguard Prime MMF VMRXX) — invest in commercial paper, CDs, corporate notes. Higher yield (5-15 basis points typically) but slight credit risk. 2008 financial crisis: Reserve Primary Fund 'broke the buck' (NAV fell below $1.00) causing investor panic. Subsequent reforms made prime MMFs subject to redemption gates and liquidity fees in stress periods.
For most consumers: government MMFs are appropriate default — slightly lower yield but materially lower credit risk and no risk of redemption restrictions. Yield differential 5-15 bps generally not worth the additional risk for liquidity-focused investors.
Treasury Bills as alternative to MMF
Direct Treasury Bill purchases via TreasuryDirect.gov or brokerages are often superior to MMFs for tax-efficient cash management. T-bills (4 week, 8 week, 13 week, 26 week, 52 week maturities) yield essentially same as MMFs but with key advantages.
Tax advantage: T-bill interest is state-tax-exempt. For California (9.3% state tax) or NY (~8-10%) residents, this materially boosts after-tax yield. $100K in T-bills at 5% yield generates $5,000 federal-taxable interest but $465 state tax savings vs MMF — effectively 5.46% tax-equivalent.
Mechanics: schedule auto-rollover at TreasuryDirect or buy through brokerage (Fidelity, Schwab, Vanguard) for marginal convenience. 4-week T-bills auto-roll monthly providing continuous exposure to short-term Treasury yields. For substantial cash positions ($25K+) in high-tax states, T-bills typically outperform MMFs by ~30-50 bps after-tax.
Trade-off: T-bills have specific maturity dates while MMFs offer daily liquidity. For consumers needing intra-month access to all cash, MMFs preserve flexibility. For consumers with reliable monthly cash flows, T-bills provide better tax-adjusted yield.
U.S. money market fund yields (2024)
Reference current yields on major U.S. money market funds and alternatives.
| Vehicle | Current yield (7-day SEC) | State-tax exempt? | Notes |
|---|---|---|---|
| Vanguard Federal MMF (VMFXX) | ~5.25% | Partial | Most VMFXX is Treasury — state-exempt portion |
| Vanguard Treasury MMF (VUSXX) | ~5.20% | Yes | 100% Treasury-backed |
| Fidelity Government MMF (FZFXX) | ~5.00% | Partial | |
| Schwab Government MMF (SWGXX) | ~5.00% | Partial | |
| Fidelity Treasury Only MMF (FDLXX) | ~5.10% | Yes | 100% Treasury |
| Prime MMF (Vanguard VMRXX) | ~5.30% | No | Slight credit risk |
| Direct Treasury Bill (4-week) | ~5.20% | Yes | Plan around maturities |
| Brokered CD (matched maturity) | ~5.10% | No | FDIC insured |
Treasury-only MMFs are slightly lower yield than government or prime but state-tax-exempt — preferred in high-tax states. Direct T-bill purchases are mechanically slightly more work but produce best after-tax yield for cash management. Brokerage account MMFs (default cash position in Fidelity, Schwab, Vanguard) typically use core government MMF unless changed by investor.
Frequently Asked Questions
How is money market fund growth calculated?
The starting balance and each monthly deposit compound at the fund's yield (annual yield ÷ 12 per month). $10,000 plus $500/month for 5 years at 4% grows to about $45,359, with roughly $5,359 of that being earnings.
Is a money market fund the same as a money market account?
No. A money market fund is an investment product from a brokerage/fund company and is not FDIC-insured. A money market deposit account is a bank account that is FDIC-insured. Both are low-risk and liquid, but the insurance status differs — an important distinction for risk-averse savers.
Is the yield guaranteed?
No — money market yields are variable and track short-term interest rates, so the yield can rise or fall over time. This projection assumes a constant yield, so treat it as an estimate. Check the fund's current 7-day yield, which is the standard measure of what it's paying now.
Are money market funds safe?
They're considered very low-risk — investing in very short-term, high-quality debt and aiming for a stable share price — but not risk-free like an FDIC-insured deposit. In rare market crises, funds can 'break the buck' (drop below $1.00) or impose redemption restrictions. For most savers they're a safe place for cash, just not insured.
What is a money market fund best used for?
A liquid, low-risk home for cash — emergency funds, near-term goals, and money awaiting investment — earning a competitive short-term yield. It's not for long-term growth, since the yield typically trails long-term investment returns. Watch the expense ratio (it reduces net yield) and remember the income is taxable.
When is this calculator unreliable?
As a forward projection — money market yields follow Federal Reserve policy and change substantially. Forward modeling assumes constant yield over multi-year periods, which is unrealistic. Also unreliable when not distinguishing government from prime MMFs (credit risk and redemption fee provisions differ) or when missing the state-tax-exempt benefit of Treasury-backed funds for high-tax-state residents.
References & Authoritative Sources
- U.S. Securities and Exchange Commission (SEC) — Money Market Funds — Investor Bulletin · consulted June 1, 2026 · Federal regulator guidance on MMF investing
- Investment Company Institute (ICI) — Money Market Fund Industry Statistics · consulted June 1, 2026 · Industry trade association data on U.S. MMF assets
- U.S. Federal Reserve Economic Data (FRED) — Money Market Fund Yields · consulted June 1, 2026 · Federal data on U.S. MMF yields
Related Calculators
Data Sources & Benchmarks
This calculator draws on 1 independent, dated source. The starting values for annual yield are taken from the benchmarks below and refresh whenever the snapshots are updated.
Methodology & Review
Money market fund growth uses compound interest formula with current yield. The calculator returns balance growth over time. U.S. money market funds 2024: typical yields 5.0-5.3% (7-day SEC yield); slightly higher than HYSA; lower risk than other investments; daily liquidity. Two types: government money market funds (Treasury and government securities) and prime money market funds (commercial paper, CDs). Government funds have lower yield but higher safety; prime funds have higher yield but greater credit risk. RELIABILITY: Reliable for documented current yield. Less reliable for forward projections because yields change with Federal Reserve policy (typically follow Fed Funds rate closely). 2020 yields dropped from ~2% to ~0% in 3 months; 2022-2023 rose from ~0% to ~5%. Always confirm current yield before relying on calculation.
Updated