What is an investment calculator?
An investment calculator shows how money you invest today, plus money you keep adding, could grow over time. You give it a starting amount, how much you plan to contribute, how long you will stay invested and the return you expect. It then works out your future balance and splits it into the money you put in and the growth your investments produced.
Use it to check whether your saving is on track, compare scenarios like adding an extra $100 a month, and see what your future balance would really buy after inflation.
How to use this calculator
- Choose your currency and enter your starting amount (use 0 if you are starting from scratch).
- Enter your regular contribution and choose whether you add it monthly or yearly, at the beginning or end of each period.
- Enter your expected annual return and the number of years.
- Optionally add a yearly contribution increase and an inflation rate.
- Press Calculate to see your end balance, a chart and a year-by-year table.
How investment growth is calculated
Your end balance has two parts. The first is your starting amount, which grows on its own:
FV = P × (1 + r)t
Here P is the starting amount, r is the annual return as a decimal and t is the number of years. The second part is your regular contributions. Each one grows for a different length of time: early deposits have decades to compound, while the last one barely grows at all. For equal contributions at the end of each period, the total is:
FV = C × ((1 + i)n − 1) ÷ i
C is the contribution, i is the return per period and n is the number of contributions. For monthly contributions, the calculator turns the annual return into the equivalent monthly rate, so a lump sum still grows by exactly the annual return each year.
Worked example: you start with $10,000, add $200 at the end of every month and earn 7% a year for 20 years.
The $10,000 grows to 10,000 × 1.0720 ≈ $38,696.84. The 240 monthly deposits, growing at about 0.565% a month, add up to $101,507.28.
End balance: $140,204.12. You put in $58,000, so $82,204.12 came from investment growth.
What return rate should you use?
There is no single right answer, and no return is guaranteed. A useful starting point is to match the rate to what you actually hold. Cash savings and short-term deposits usually pay relatively low rates. Bonds have historically sat somewhere in the middle. Diversified stock portfolios have historically delivered higher long-term average returns in many markets, but with large ups and downs along the way, including years of losses.
Because the future is uncertain, try a cautious, a middle and a hopeful rate. If your plan only works with the hopeful one, it is worth revisiting.
How inflation affects your results
Inflation means prices tend to rise, so money buys less over time. A balance of $100,000 in 20 years will not feel like $100,000 today. At 3% inflation, it would buy roughly what $55,400 buys now. Enter an inflation rate and the calculator also shows your end balance in today's money.
In the worked example above, 2.5% inflation turns $140,204.12 into about $85,562.50 in today's money.
Tips for growing your investments
- Start early. Each contribution gets more years to compound.
- Automate contributions so investing happens without a decision every month.
- Increase contributions with your income, even by a few percent a year.
- Watch costs. Low-fee, diversified funds leave more of your return working for you.
- Use tax-advantaged accounts such as a TFSA, RRSP, ISA or 401(k) where they suit you.
- Stay the course. Selling in a downturn can lock in losses that patience might have recovered.
Frequently asked questions
Should I choose contributions at the beginning or end of each period?
Choose the option that matches when money actually reaches your account. If you invest on payday at the start of the month, pick beginning. Money added at the beginning gets one extra period of growth, but the difference is usually small: $500 a month at 6% for 30 years grows to about $487,256 with end-of-month contributions and about $489,628 with beginning-of-month contributions.
How is the expected annual return applied to monthly contributions?
The calculator treats your expected return as the amount your investment grows in a full year. For monthly contributions it uses the equivalent monthly rate, so 6% a year becomes about 0.487% a month. That way a lump sum grows by exactly 6% a year, whichever contribution frequency you choose.
What does the annual contribution increase do?
It raises your regular contribution once a year by the percentage you enter. For example, with $300 a month and a 3% increase, you contribute $300 a month in year one, $309 a month in year two, and so on. It is a simple way to model saving more as your income grows.
Does this calculator include taxes and fees?
No. Results are before taxes and investment fees. To include fees roughly, subtract them from your expected return. For example, if you expect 7% and pay 0.5% a year in fees, enter 6.5%. Inflation can be included with the optional inflation rate field.
Why is the balance in today's money so much lower?
Prices usually rise over time, so the same amount of money buys less in the future. The today's money figure shows what your end balance would be worth in current purchasing power. It is often the more useful number when you are planning a goal such as retirement.
Results are estimates for educational purposes only and are not financial advice. Investments can lose value and actual returns will vary.