Investment Calculator
- Updated
- Formula shown
- Free, no sign-up
Results
$10,000.00 plus $500.00 a month at an assumed 6% a year grows to $258,790.67 in 20 years
- Starting amount
- $10,000.00
- Contributions
- $120,000.00
- Growth
- $128,790.67
| Year | Invested | Growth | Balance |
|---|---|---|---|
| 1 | $16,000.00 | $763.26 | $16,763.26 |
| 2 | $6,000.00 | $1,169.06 | $23,932.32 |
| 3 | $6,000.00 | $1,599.20 | $31,531.53 |
| 4 | $6,000.00 | $2,055.16 | $39,586.68 |
| 5 | $6,000.00 | $2,538.47 | $48,125.15 |
| 6 | $6,000.00 | $3,050.77 | $57,175.92 |
| 7 | $6,000.00 | $3,593.82 | $66,769.74 |
| 8 | $6,000.00 | $4,169.45 | $76,939.19 |
| 9 | $6,000.00 | $4,779.62 | $87,718.81 |
| 10 | $6,000.00 | $5,426.39 | $99,145.20 |
The return is an assumption, held the same every year. Real investments rise and fall, can lose money, and may have fees and taxes not shown here.
How to use the investment calculator
- Choose what to find: the end balance, the contribution needed for a target, or the return needed for a target.
- Enter your starting amount, how much you add and how often, and whether contributions go in at the start or the end of each period.
- Enter the time and an assumed average annual return. Use a return after fees, and try more than one.
- Optionally add an inflation rate to see the result in today's money.
Investment growth formula
i = (1 + R)1 ÷ p − 1
S is the starting amount, C each contribution, R the assumed annual return as a decimal, t the years, p the contributions per year, n = p × t and s 1 for contributions at the start of each period (0 at the end). The return is treated as an effective annual rate, the way fund returns are usually quoted, so with monthly contributions the money grows by 0.4868% a month at 6%, which compounds to exactly 6% over a year.
The target modes rearrange the same equation. The contribution needed has a direct formula. The return needed does not, so the calculator finds it numerically, as a spreadsheet RATE function would.
Worked example
$10,000 to start, $500 at the end of every month, for 20 years, with an assumed 6% average annual return:
- End balance: $258,790.67, from $130,000 invested and $128,790.67 of growth.
- Contributing at the start of each month instead: $259,894.24.
- To reach $500,000 at the same 6%, the monthly contribution would need to be $1,031.96.
- To reach $500,000 with $500 a month, the investment would need to average 11.24% a year, a much more demanding assumption.
$500 a month at different assumed returns
No starting amount, contributions at the end of each month. The returns are illustrations only, not predictions.
| Assumed return | After 10 years | After 20 years | After 30 years |
|---|---|---|---|
| 4% a year | $73,348 | $181,921 | $342,635 |
| 6% a year | $81,237 | $226,719 | $487,256 |
| 8% a year | $90,062 | $284,500 | $704,275 |
After 30 years you have put in $180,000 in every row. The spread between the rows comes entirely from the assumed return, which shows how sensitive long projections are to it.
Reading the projection honestly
- Returns are not steady. Real investments go up and down, and can lose money. The calculator uses the same return every year, so the result is a scenario, not a forecast. To see how uneven returns average out, try the average return calculator.
- Fees compound too. In the example over 30 years, an assumed 6% gives $544,691, while 5% (the same investment with a 1% yearly fee) gives $450,907: $93,784 less.
- Taxes are not included. Depending on the account, you may owe tax on gains, dividends or withdrawals.
- Think in today's money for long goals. Add an inflation rate, or compare with the inflation calculator. For a fixed, guaranteed rate, use the savings calculator instead.
Frequently asked questions
How much will my investment be worth?
It depends on the return, which is never guaranteed. As an illustration, $10,000 plus $500 a month for 20 years at an assumed 6% a year would grow to $258,790.67, from $130,000 invested. Try several returns to see a range.
How much do I need to invest each month to reach a target?
Choose “Contribution needed” and enter the target. To reach $500,000 in 20 years from $10,000 at an assumed 6% a year, you would need to invest about $1,031.96 a month.
What return do I need to reach my goal?
Choose “Return needed”. Reaching $500,000 in 20 years from $10,000 plus $500 a month would need an average of about 11.24% a year, which is a demanding assumption; a larger contribution or more time is the more reliable lever.
Is the return an annual or monthly rate?
It is an average effective annual return. With monthly contributions the calculator grows the balance by (1 + R)^(1/12) − 1 each month, which compounds to exactly R over a year: 0.4868% a month for 6%.
Why does a 1% fee matter so much?
Fees reduce the return every year, and the loss compounds. $10,000 plus $500 a month for 30 years grows to $544,691 at an assumed 6% but $450,907 at 5%, a difference of $93,784.