Investment Calculator & Portfolio Growth Simulator

How this calculator works

It grows your starting balance month by month at the equivalent monthly rate for your chosen compounding frequency, and adds each contribution at the end of its period (monthly or yearly), optionally raising contributions 3% a year. Tax drag reduces each period's growth by the chosen share, and the real value divides the result by cumulative inflation.

By Suhaib Hassan · Formula verified 27 Sep 2026; worked examples re-run through the calculator on 16 Oct 2026 · How CalculatePilot verifies formulas →

Understanding investment risk

This calculator assumes a constant annual return for simplicity, but real markets fluctuate year to year. Treat the result as a long-term average projection, not a guarantee — higher expected returns generally come with higher volatility.

What return rate should I actually assume?

The rate you enter drives everything else, so it's worth grounding it in real benchmarks rather than guessing.

• Diversified stock portfolios — historically around 7–10% annually before inflation over multi-decade periods, though any single year can vary widely.
• Bond funds — roughly 4%+ for U.S. government bonds as of recent years, more for higher-risk corporate or high-yield bonds.
• High-yield savings accounts and CDs — typically 3–4%+ depending on the rate environment and term.

A practical approach: run the calculator twice — once with a conservative rate (2–3 points below the historical average) and once with an optimistic rate (1–2 points above) — to see a realistic range rather than a single number that may not happen.

Understanding sequence of returns

This calculator assumes a constant annual return, but real markets rise and fall unevenly year to year. Two investors with the same average return can end up with very different balances depending on when the gains and losses occurred — a concept called sequence of returns risk.

This matters most near the point of withdrawal (like retirement), where a downturn early in that phase has an outsized negative impact compared to the same downturn occurring years later, since there's less time to recover before money is withdrawn.

A worked example

Investing $10,000 upfront plus $300/month at an 8% average annual return (compounded monthly) for 20 years grows to roughly $226,000. Of that, about $82,000 came from contributions and roughly $144,000 came from investment growth — nearly two-thirds of the final balance is growth, not deposits.

This illustrates why starting to invest early tends to matter more than the exact monthly amount — the growth portion compounds regardless of when contributions were made, so earlier dollars have simply had more time to work.

Diversification and risk

This calculator assumes a single constant return rate, but real investments carry risk that varies by asset type — stocks historically offer higher long-term returns than bonds, but with more year-to-year volatility. Diversifying across asset types is a common strategy to manage that volatility while still capturing long-term growth.

Tax treatment also affects real-world returns. Growth inside tax-advantaged accounts like a 401(k) or IRA isn't taxed annually the way a standard brokerage account often is, which can meaningfully improve actual after-tax growth compared to what a simple projection shows. Also worth checking: how much that growth is worth in today's dollars using our Inflation Calculator.

How to calculate investment return: ROI, CAGR and annualised return

The calculator projects a future balance. These formulas measure how an investment has already performed, so you can pick a realistic return to enter above.

• Return on investment (ROI) = (ending value − starting value) ÷ starting value. It ignores how long the money was invested.
• Compound annual growth rate (CAGR) = (ending value ÷ starting value)^(1 ÷ years) − 1. It turns the total gain into a yearly rate you can compare with other investments.

Example: $10,000 that grows to $22,000 over 8 years has an ROI of 120%, but a CAGR of about 10.36% a year. If you added money along the way, CAGR on the ending value overstates your return, so use this calculator's contribution inputs instead.

The compound growth formula with regular contributions

With a monthly rate i (annual return ÷ 12 for monthly compounding) and n months, the future value is P × (1 + i)ⁿ + C × ((1 + i)ⁿ − 1) ÷ i, where P is the starting amount and C is the monthly contribution added at the end of each month.

Example: $10,000 plus $300 a month at 8% for 20 years grows to $225,974. Contributions total $82,000, so $143,974 (about 64% of the final balance) is investment growth.

Nominal vs real return

Real return = (1 + nominal return) ÷ (1 + inflation) − 1. An 8% nominal return with 3% inflation is a real return of about 4.85%. The same $225,974 balance is worth about $125,116 in today's dollars after 20 years of 3% inflation, which is why the calculator shows both figures.

How fees and tax drag change the result

Scenario ($10,000 + $300/month, 20 years)	Ending balance
8% return, no fees, no tax drag	$225,974
7% return (an 8% fund minus a 1% annual fee)	$196,665
8% return with 15% of each year's gains lost to tax	$191,350

A 1 percentage point fee costs about $29,300 here, roughly 13% of the final balance. Entering your return after fees is the simplest way to model it. The tax-drag setting reduces each period's growth by the share you pick; it is a simplification and not a tax calculation.

Which calculator should you use?

• Investment Calculator (this page): a starting amount plus regular contributions, with inflation and tax drag.
• Compound Interest Calculator: compare daily, monthly and continuous compounding.
• Savings Goal Calculator: work backwards from a target amount.
• Roth IRA Calculator and 401(k) Calculator: retirement accounts with limits and employer match.

Want the formulas in more depth? Read how to calculate investment return: ROI vs CAGR, with examples.

Frequently asked questions

Is 8% a realistic return assumption?expand_more

It's within the historical long-term range for diversified equity portfolios before inflation, but past performance doesn't guarantee future results.

How much difference do monthly contributions make?expand_more

A great deal over long periods — consistent contributions often account for more of the final balance than the initial investment itself, thanks to compounding.

Should I invest a lump sum or spread it out (dollar-cost averaging)?expand_more

Historically, investing a lump sum immediately outperforms spreading it out on average, since markets trend upward over time — but dollar-cost averaging can reduce regret risk and smooth out volatility for some investors.

What's a reasonable fee to pay on investments?expand_more

Low-cost index funds often charge well under 0.5% annually, while some actively managed funds charge 1% or more — fees compound over time just like returns, so lower costs meaningfully help long-term growth.

What is dollar-cost averaging?expand_more

Investing a fixed amount at regular intervals regardless of market price, which smooths out the effect of market timing and is the strategy this calculator's monthly contribution feature effectively models.

Should I use a tax-advantaged account for long-term investing?expand_more

Accounts like a 401(k), IRA, or Roth IRA offer tax benefits that can meaningfully improve long-term after-tax growth compared to a standard taxable brokerage account, making them worth prioritizing for retirement-focused investing.

How do you calculate return on investment?expand_more

Subtract the starting value from the ending value and divide by the starting value. For example, $10,000 growing to $22,000 is an ROI of 120%. ROI ignores time, so use CAGR to compare investments held for different periods.

What is the difference between ROI and CAGR?expand_more

ROI is the total percentage gain over the whole holding period. CAGR converts that gain into the steady yearly rate that would produce it, using (ending ÷ starting)^(1 ÷ years) − 1. $10,000 growing to $22,000 over 8 years is a 120% ROI and a CAGR of about 10.36%.

How do I calculate real return after inflation?expand_more

Divide one plus your nominal return by one plus the inflation rate, then subtract one. An 8% return with 3% inflation is a real return of about 4.85% a year.

How do fees affect investment growth?expand_more

Fees come out of your return every year, so they compound. In this calculator, $10,000 plus $300 a month for 20 years ends at about $225,974 at 8% but $196,665 at 7%, so a 1 percentage point fee costs roughly $29,300.

How long does it take to double my money?expand_more

The Rule of 72 estimates it as 72 divided by your annual return. At 8%, money doubles in about 9 years (the exact figure is 9.01 years). Regular contributions shorten the time to double your total balance.