DEFINITION of 'Anticipated Balance'

The amount that a savings account will have at some future date, or that a time deposit will have at maturity, assuming no withdrawals or additional deposits occur. In broad terms, anticipated balance means the net balance in any account at a future point in time. Calculation of the anticipated balance assumes compound interest, rather than simple interest.

BREAKING DOWN 'Anticipated Balance'

Anticipated balances are important in the context of financial planning. For example, consider a couple that wants to save $20,000 over the next four years as the down payment for a house.

They currently have $10,000 in savings, and to achieve their dream of becoming homeowners, would like to know approximately how much they should save per year in a time deposit, in order to reach their target of an anticipated balance of $20,000 in four years. Assuming a compound interest rate on deposits of 3% per annum, they would need to save $2,390 per year.

RELATED TERMS
  1. Anticipated Interest

    The amount of interest that a savings vehicle will accrue by ...
  2. Call Deposit Account

    A bank account for investment funds that offers the advantages ...
  3. Deposit In Transit

    A deposit in transit is money that has been received by a company ...
  4. Deposit

    1. A transaction involving a transfer of funds to another party ...
  5. Demand Deposit

    Funds held in an account from which deposited funds can be withdrawn ...
  6. Time Deposit

    A savings account or certificate of deposit (CD) held for a fixed-term, ...
Related Articles
  1. Investing

    What is a Demand Deposit?

    A demand deposit is any type of account where the money in the account may be withdrawn at any time without prior notice to the financial institution.
  2. Investing

    Explaining Term Deposits

    A term deposit (more often called a certificate of deposit or CD) is a deposit account that is made for a specific period of time.
  3. Personal Finance

    Get the Best Savings Interest Rates For You

    How do you choose between market deposit accounts, CDs and traditional savings accounts?
  4. Personal Finance

    Understanding Savings Accounts

    A deposit account held at a bank or other financial institution that provides principal security and a modest interest rate.
  5. Personal Finance

    Handling High-Yield Savings Accounts

    Is this the savings route for you? Read on to find out what these accounts have to offer.
  6. Personal Finance

    The 7 Best Places To Put Your Savings

    You work hard to put your money away for the future, but where you should you keep it?
  7. Investing

    Money Market Accounts with the Highest Interest Rates

    Money market savings accounts can offer higher interest rates than regular or even high-yield bank savings accounts – and perks like these.
  8. Personal Finance

    These Savings Accounts Have the Highest Interest Rates

    Don't expect interest from a bank savings account to make you rich. You can do better, however, than the paltry 0.08% average paid in 2015.
  9. Personal Finance

    Protect Your Savings From Their Greatest Threat - You

    Watch your savings magically grow as you make withdrawals a headache and deposits a breeze.
RELATED FAQS
  1. For what types of accounts are demand deposits available?

    Learn about the different types of accounts designated as demand deposit accounts, such as savings accounts and money market ... Read Answer >>
  2. What is the difference between a demand deposit and a term deposit?

    Understand the meaning of demand deposits and term deposits, and learn about the major differences between these two types ... Read Answer >>
  3. What are the Federal Reserve's guidelines on demand deposit accounts?

    Read about some of the Federal Reserve's requirements and guidelines regarding the treatment, safeguarding and processing ... Read Answer >>
  4. What economic factors affect savings account rates?

    Find out how supply, demand and central bank policy all affect savings account rates offered by banks for extra deposits ... Read Answer >>
  5. What determines the interest rate in my money market account?

    Placing funds in a money market account may provide a higher interest rate than a savings account due to the underlying securities ... Read Answer >>
Trading Center