What This Calculator Does
This tool projects how a lump-sum investment combined with recurring monthly contributions grows over time, assuming a fixed annual rate of return compounded monthly. It’s built around the same math brokerages and financial planning software use internally, the future value of an annuity formula, so the output should line up closely with what you’d get from Excel’s FV() function or a brokerage’s own retirement projection tool.
The point isn’t to predict what the market will actually do. It’s to make the relationship between three variables, time, contribution size, and rate of return, visible and adjustable, so you can see how sensitive your outcome is to each one before you commit real capital. If you’re contributing on a schedule rather than modeling a single lump sum, the Dollar-Cost Averaging Calculator is the more direct tool. If you’re modeling a real portfolio rather than a hypothetical rate, it’s worth checking a specific holding like Coca-Cola against its own long-run dividend and price history rather than assuming the same fixed number holds every year. Check your compound interest by daily, weekly, monthly, yearly.
Compound Interest Calculator
This calculator compounds at the same frequency as your contributions and is for estimation purposes only. It does not constitute investment advice. Actual returns will vary based on market performance, inflation, taxes, and fees.
How to Use It
Starting balance, whatever you’re investing today as a lump sum. Leave it at zero if you’re starting fresh.
Monthly contribution, your recurring investment amount. If you’re dollar-cost averaging into an index fund or ETF on a fixed schedule, this is that number.
Expected annual return, this is the assumption doing the heavy lifting, and it deserves some scrutiny rather than a default guess. The S&P 500’s long-run nominal annual return sits roughly in the 9–10% range going back to the 1950s, closer to 6–7% after adjusting for inflation. Bond-heavy portfolios trend lower, concentrated growth portfolios have historically run higher with more variance. Whatever number you use here is a projection input, not a guarantee, the calculator will happily compound 15% a year forever if you tell it to, which is exactly why this field deserves honesty over optimism.
Time horizon, number of years you plan to keep contributing.
The output splits the final balance into two pieces: total principal contributed and growth generated by compounding. That split matters more than the headline number. Early in a plan, most of the balance is your own money. Compounding’s contribution grows disproportionately in the later years, which is the entire argument for starting early rather than starting large.
A Few Things Worth Knowing
Monthly compounding is an approximation. Most equity returns aren’t smooth, a 7% “annual return” is really a string of up years, down years, and flat years averaging out to 7%, not a steady monthly increment. This calculator, like virtually every DCA calculator, smooths that out for planning purposes. Real portfolio paths will be lumpier, even if they land near the same long-run endpoint.
This also doesn’t account for taxes, fund expense ratios, or inflation eroding the purchasing power of that final number. A $500,000 balance in 25 years buys meaningfully less than $500,000 today. If you want a real (inflation-adjusted) sense of purchasing power, a reasonable shortcut is running the same calculation with your return rate reduced by your assumed inflation rate.
None of this is investment advice, it’s arithmetic. What you do with the output is a separate decision that depends on your risk tolerance, time horizon, and the rest of your financial picture.
Financial Disclaimer: The content on StockVane is for educational and informational purposes only and should not be construed as professional financial advice. Stock market investing involves risk of loss.