Investment Calculator
Project what regular investing becomes over time — in tomorrow's dollars and, more honestly, in today's purchasing power.
| Year | Contributed | Growth | Balance |
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The math (and its honest limits)
The projection compounds your balance monthly at your assumed annual return:
Real value = Nominal ÷ (1 + inflation)years
Real markets don't return the same number every year — they lurch. A smooth 7% line is a planning average, not a promise; actual sequences of returns can land meaningfully higher or lower, especially over short periods.
$5,000 start + $500/mo at 7% for 20 years:
Projected value ≈ $280,000 ($125,000 contributed, ~$155,000 growth)
In today's purchasing power at 3% inflation: ≈ $155,000.
What actually moves the outcome
In order: time in the market (each extra decade roughly doubles-plus the result — the compounding curve is steepest at the end), contribution rate (the only variable fully in your control), costs (a 1% annual fee compounds against you exactly like a 1% lower return — six figures over a career), and only then asset selection. Historical context: the S&P 500's long-run average is ~10% nominal, ~7% real, but individual decades have ranged from negative to +18%/yr. Model conservatively, contribute aggressively. For the payout phase, see the withdrawal calculator; for the tax wrapper decision, the 401(k) and Roth IRA calculators.
Common mistakes when projecting investment growth
- Assuming double-digit returns as a baseline. Modeling 12–15% "just to be safe" produces wildly optimistic numbers that can lead to under-saving. Stick to the historically grounded 6–8% range for stock-heavy portfolios.
- Ignoring sequence-of-returns risk. Two portfolios with the same average return can end up very different if losses land early versus late — a smooth projection can't capture this, which matters most in the years just before and after retirement.
- Comparing nominal projections to today's prices. A $500,000 balance in 25 years is not $500,000 of today's buying power — always check the inflation-adjusted figure before deciding if a target is "enough."
- Treating the projection as a guarantee. This is a planning tool based on an assumed average return, not a forecast — actual portfolio values will diverge from a smooth line in both directions.
Frequently asked questions
What is a realistic investment return to assume?
Stocks have averaged ~10% nominal (~7% real) over the past century; 6–8% is a common planning range for diversified portfolios.
How much will $500 a month be worth in 20 years?
At 7%, roughly $260,000 — $120,000 contributed, ~$140,000 growth.
Why show inflation-adjusted results?
Because future dollars buy less. $260,000 in 20 years ≈ $144,000 of today's purchasing power at 3% inflation.
What is sequence-of-returns risk?
The risk that the order of gains and losses, not just their average, changes your outcome — a market crash early in retirement (while withdrawing) does far more damage than the same crash decades earlier while still contributing.
Should I use the same return assumption for stocks and bonds?
No — a diversified portfolio with bonds typically has a lower expected return than an all-stock portfolio in exchange for less volatility. Model your actual asset mix's historical average rather than a pure-stock figure if your portfolio includes bonds or cash.
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Note: Projections assume constant returns, which markets do not deliver; actual results will differ. Educational only — not investment advice or a recommendation of any security or strategy. Last reviewed: July 2026.