Investment Calculator
Calculate the future value of an investment with one-time or recurring contributions, and see the effect of different return rates.
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How to use this calculator
FV = future value, P = principal, r = annual rate, n = compounding frequency, t = years, PMT = periodic addition.
- 1
Enter your starting investment amount.
- 2
Enter how much you will add each month.
- 3
Enter the expected annual return rate (historical S&P 500 avg ≈ 10%).
- 4
Select how often interest is compounded.
- 5
See the projected portfolio value and total gains.
Frequently asked questions
What annual return rate should I use?
The S&P 500 has historically averaged ~10% nominal (7% inflation-adjusted). A balanced 60/40 stock-bond portfolio averages ~6–7%. Bonds alone: ~3–4%. For conservative planning, use 6–7%; for illustrative "best case," use 10%.
How does compounding frequency affect returns?
More frequent compounding earns slightly more. At 8% annual rate, $10,000 over 20 years: annual compounding → $46,610; monthly → $49,268; daily → $49,530. The gap is modest but real.
Should I invest a lump sum or spread it out?
Statistically, lump-sum investing beats dollar-cost averaging about two-thirds of the time because markets rise more often than they fall. However, DCA reduces the risk of investing right before a crash and is easier to sustain emotionally.
How do taxes affect investment returns?
In taxable accounts, dividends and realized gains are taxed annually, reducing effective returns. In tax-advantaged accounts (Roth IRA, 401k, ISA), growth is tax-deferred or tax-free, significantly improving long-term outcomes.
Investment growth explained
Why time in market beats timing the market
Missing just the 10 best trading days per decade cuts returns dramatically. An investor who stayed fully invested in the S&P 500 from 2003–2022 averaged ~9.8% annually. An investor who missed the 10 best days averaged ~5.6%. Starting early and staying invested is the single most powerful variable.
Understanding compound growth
At 8% annual return, money doubles roughly every 9 years (Rule of 72: 72 ÷ 8 = 9). A 25-year-old investing $5,000 today could see it become $160,000 by age 70 without adding another dollar — purely from compounding.
Low-cost index funds vs active management
Most active fund managers underperform their benchmark index over 10+ years, especially after fees. A low-cost index ETF (expense ratio 0.03–0.2%) keeps nearly all the market return. A 1% annual fee sounds small but cuts a 30-year portfolio by roughly 25%.
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Results are estimates for informational purposes only and do not constitute professional financial, medical, legal, or technical advice. Read full disclaimer →