Visualize the power of compound growth.
Use this free investment calculator to estimate the future value of your portfolio. By inputting your starting balance, recurring contributions, and expected rate of return, you can see how your wealth grows over time.
Investment Returns
Project your portfolio growth based on market returns.
| Year | Contribution | Profit | Total Balance |
|---|
How Investment Growth Works
The key to building wealth is the combination of regular contributions and compound returns. When your investment earns a return (like interest or stock appreciation), that return gets added to your principal. In the following year, you earn returns on your original money plus the returns from the previous year.
Key Factors
- Time Horizon: The longer your money stays invested, the more powerful the compounding effect becomes.
- Rate of Return: The annual percentage growth of your investment. Historically, the stock market (S&P 500) has returned about 10% annually on average, though it fluctuates year to year.
- Frequency: Contributing monthly helps smooth out market volatility (dollar-cost averaging) compared to lump-sum annual contributions.
Frequently Asked Questions
What is a good rate of return?
For long-term stock market investments, many experts use 7% to 10% as a benchmark (before inflation). For safer investments like bonds or CDs, rates are typically lower, often between 3% and 5%.
Does this include inflation?
No, this calculator shows the nominal future value of your money. To understand the purchasing power (real value), you would need to subtract the expected inflation rate (historically around 2-3%) from your rate of return.
Are investment returns guaranteed?
No. Unlike savings accounts or CDs which have FDIC insurance, investments in stocks, mutual funds, and ETFs carry risk. You could lose money, and past performance does not guarantee future results.
