Investment Calculator
Estimate how your investments can grow over time with compound interest and regular contributions.
What the investment calculator does
The investment calculator projects how a starting sum plus regular monthly deposits grows at a fixed annual rate over a number of years. Enter the initial investment, the monthly contribution, the annual interest or return rate and the investment period, then press Calculate. The result shows the total you paid in, the projected value at the end, and the difference between them, which is your profit.
How the calculation works
The annual rate is divided by 12 and applied every month. The initial sum compounds for the whole period, and each deposit compounds from the month it is made:
- Future value of the lump sum = initial × (1 + i)n
- Future value of the deposits = monthly × [((1 + i)n − 1) / i]
- Total invested = initial + monthly × n
- Profit = future value − total invested
where i is the monthly rate and n the number of months.
Worked examples
| Initial | Monthly | Rate | Years | Invested | End value | Profit |
|---|---|---|---|---|---|---|
| $10,000 | $200 | 7% | 20 | $58,000 | $144,600 | $86,600 |
| $0 | $500 | 8% | 30 | $180,000 | $745,200 | $565,200 |
| $50,000 | $0 | 5% | 10 | $50,000 | $82,400 | $32,400 |
| $5,000 | $300 | 6% | 15 | $59,000 | $99,500 | $40,500 |
Rounded to the nearest $100. In the second row, three quarters of the final value is growth rather than deposits; that share rises with time and with the rate.
Choosing a rate
| Investment | Typical long-run annual return | Notes |
|---|---|---|
| Savings account or CD | 2 to 5% | Guaranteed; varies with central bank rates |
| Government or investment-grade bonds | 3 to 5% | Low volatility; can fall when rates rise |
| 60/40 stock and bond fund | 6 to 8% | Moderate swings |
| Broad stock index fund | 8 to 10% | Long-run U.S. average; large short-term losses possible |
These are nominal figures. Subtract about 2.5 to 3% for inflation to think in today’s money; the inflation calculator shows the effect on a lump sum. Fees come off the top too: a 1% annual charge on an 8% fund makes it a 7% fund, and over 30 years that costs roughly a fifth of the final value. The average return calculator and CAGR calculator help derive a realistic rate from past performance.
Why regular deposits matter
Monthly investing does two things. It builds the balance steadily, and it averages the purchase price over time, so you buy more units when prices are low. In the $500-a-month example, delaying the start by five years reduces the 30-year result from $745,000 to about $475,000: the first five years of deposits, only $30,000, end up worth $270,000 because they compound the longest.
Reading the profit figure
Profit is before tax. In a tax-advantaged account such as an IRA, 401(k) or ISA it stays that way until withdrawal or entirely. In a taxable account, dividends are taxed each year and gains when you sell; the capital gains tax calculator estimates that bill. Profit is also nominal; part of it only keeps pace with prices.
Common mistakes
- Entering a monthly rate as the annual rate. The field wants the annual figure; the tool divides by 12.
- Using the best recent year as the expected return. A 25% year is not a rate you can plan on. Use long-run averages.
- Ignoring fees. Enter the return net of expense ratios and platform charges.
- Forgetting that the path is not smooth. A constant 8% never happens; the model gives the average outcome, not a guarantee.
Related tools
The compound interest calculator shows different compounding frequencies. The future value calculator and net present value calculator move between today’s and future money, the retirement savings calculator applies the same maths to a retirement date, and the risk tolerance calculator and portfolio volatility calculator help choose a mix whose return you can realistically expect.
External references
Frequently asked questions
Are deposits made at the start or end of each month?
At the end. Each deposit earns growth from the following month. Start-of-month deposits would add roughly one month’s growth to the total.
Can I enter a negative rate?
The tool accepts it, and the result shows a declining balance. It is a way to see the effect of a fee-heavy or losing investment.
What return should I assume for a stock index fund?
7 to 8% nominal is a common planning figure, below the historical average to allow for fees and uncertainty. Use 4 to 5% if you want the result in today’s purchasing power.
How is this different from the compound interest calculator?
This tool adds monthly deposits and reports total invested and profit separately. The compound interest calculator focuses on a single sum with a choice of compounding frequencies.
Does it handle a one-off deposit later on?
Not directly. Run the calculator up to the deposit date, add the deposit to the resulting balance, and run it again for the remaining years.