Investment Calculator
Calculate your investment growth with compound returns. Plan your financial future with accurate projections.
Enter Your Information
Results
About the Investment Calculator
An investment calculator projects how much a lump sum, regular contributions, or both will grow over time at an assumed return. The results are sensitive to assumptions — small changes in return or contribution levels produce wildly different end values over decades. This page covers realistic assumptions and how to stress-test your plan.
The Formula
FV = P(1+r)^n + C × [((1+r)^n − 1) ÷ r], where P is the initial investment, C is the periodic contribution, r is the periodic return, n is the number of periods.
Worked Example
$10,000 starting balance, $500/month for 25 years at 7%: lump sum grows to $54,274, contributions grow to $379,494, total ≈ $433,768. Bump the rate to 9% and total reaches $565,000. Drop to 5% and it's only $331,000.
Picking a realistic return assumption
US stocks have returned about 10% nominal / 7% real annually over the long run. Bonds 5% nominal / 2% real. A 60/40 portfolio: roughly 7-8% nominal / 4-5% real. Use real returns for retirement planning so your projection accounts for inflation eroding future spending power.
Sequence of returns risk
Average return is not the same as your actual return when you contribute over time. Most of your money is in the account during the later years. A poor return early matters less than a poor return when your balance is largest. Diversification and rebalancing mitigate this.
Tax-advantaged vs taxable accounts
401(k) and IRA contributions grow tax-deferred (or tax-free for Roth). Taxable accounts incur taxes on dividends, interest, and realized gains. Maxing tax-advantaged space first is almost always optimal.
Common Mistakes
- Assuming average returns will happen smoothly. The market drops 20%+ roughly every 5-7 years.
- Picking individual stocks instead of low-cost index funds for long-term plans.
- Stopping contributions during market drops — those are the best buying opportunities for long-term investors.
Frequently Asked Questions
How much should I invest?
Most planners suggest 15% of gross income for retirement, including employer match. More if you started late.
What if returns are lower than expected?
Save more, work longer, or spend less in retirement. Run multiple scenarios with 4%, 6%, and 8% returns to see your sensitivity.
This calculator is for informational purposes only and does not constitute financial, tax, or legal advice. Consult a licensed professional before making significant financial decisions.