Investment Calculator
Project what an investment grows to. Enter a starting amount, an expected annual return, the number of years and a yearly payment. The calculator compounds once a year and adds each payment at the end of the year. The result is the future value. Or start from a goal, and the calculator solves for the yearly or monthly contribution that reaches it.
How to use the Investment Calculator
- Enter your numbers in the Investment Calculator above.
- Press the Calculate button to see the result.
- To try other numbers, change any value and press the button again.
The investment growth formula
FV = PV(1 + r)^n + PMT · [((1 + r)^n − 1) / r]
PV is the starting amount, r is the annual return as a decimal, n is the number of years and PMT is the yearly payment. Each payment lands at the end of its year, so the last one earns no return. At a 0% return the future value is PV plus PMT times n. A negative return works too, as long as it stays above −100%. To solve for the contribution, the same formula runs the other way: PMT = (goal − PV(1 + r)^n) · r / ((1 + r)^n − 1). Monthly contributions use r ÷ 12 and n × 12.
Worked example
A $10,000 starting amount with $6,000 added at the end of each year for 20 years at 7%: FV = 10,000 × 1.07^20 + 6,000 × [(1.07^20 − 1) / 0.07]. The calculator shows that one figure, $284,669.80. By hand, you put in $10,000 + $120,000 = $130,000, so the investment growth is $154,669.80. Solve the other way for a $500,000 goal with the same start and return, and the yearly contribution is $11,252.54, or $882.30 a month with monthly compounding.
Frequently asked questions
How do I solve for the contribution?
Set "Solve For" to the contribution, then type your goal, starting amount, annual return and years, and pick yearly or monthly. The contribution rounds up to the next cent, so the balance reaches the goal. If the starting amount alone gets there, the calculator says so and the contribution is $0.00. The return you type is an assumption, and the calculator cannot know what a market will pay.
Should I use nominal or real returns?
A nominal return is what the investment pays before inflation. A real return subtracts inflation. Enter a real return to see the result in today's purchasing power, and a nominal return to see a dollar amount in the future.
How does compounding frequency affect the result?
Monthly compounding produces more than annual at the same rate, and the gap grows with time. $10,000 at 7% for 20 years ends at $38,696.84 with annual compounding and $40,387.39 with monthly. This calculator compounds once a year.
What about taxes and fees?
The calculator leaves them out, so subtract expected fund expense ratios and tax drag from the return you enter. Over 30 years, a return of 6.5% instead of 7% ends about 13% lower on a starting amount and about 9% lower on yearly payments.