Calculate future investment value with compound interest, monthly contributions, and different compounding frequencies.
Compound interest is one of the most powerful forces in personal finance — Einstein allegedly called it the eighth wonder of the world. This investment calculator shows the real impact of compounding over time, factoring in both a lump-sum initial investment and regular monthly contributions. Whether you're planning for retirement, saving for a house down payment, or building a college fund, seeing the numbers helps you make smarter decisions. The difference between starting at 25 vs 35, or contributing $200/month vs $300/month, becomes strikingly clear when visualized over decades. Use this tool to experiment with different scenarios and find the strategy that fits your goals.
Historically, the S&P 500 has returned about 7–10% annually (inflation-adjusted ~7%). For bonds, expect 3–5%. For savings accounts, check your bank's current rate. Use a conservative estimate for planning.
This calculator uses monthly compounding, which is standard for most investment accounts and gives a realistic picture of real-world growth.
No. To get inflation-adjusted returns, subtract the inflation rate from your interest rate. If you expect 8% returns and 3% inflation, use 5% as your rate for real purchasing power calculations.
Simple interest calculates returns only on the principal. Compound interest calculates returns on the principal plus all accumulated interest — earning 'interest on interest.' Over time, the difference is enormous.
Research generally favors lump-sum investing (investing all at once) over dollar-cost averaging when you have the full amount available, as markets tend to rise over time. However, monthly contributions are great for building the habit of saving.