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Compound Interest Calculator

Enter your monthly contribution, expected annual return, and investment timeline to calculate your future portfolio value.

$50$500$5,000
1%7.0%12%
1 yr20 years40 yrs
Future Portfolio Value
$260,464
Total Contributions
$120,000
Investment Gains
$140,464
Tax-Advantaged (Roth IRA/401k)
$0
No tax on gains
Taxable Account (15% cap gains)
$0
Tax savings: $0

Growth Timeline

YearContributionsPortfolio ValueGains
Assumptions: Monthly contributions at end of each month, compounded monthly. Actual investment returns will vary based on market conditions. Past performance does not guarantee future results.

What To Do Next

Ready to start investing? Here are your next steps:

Start Investing Today

Ready to put compound interest to work? Here are the best ways to get started:

  • Open a brokerage account — Low-cost platforms like Fidelity, Schwab, or Vanguard make it easy to start with index funds
  • Max out tax-advantaged accounts — 401(k) and IRA contributions grow tax-free or tax-deferred, supercharging compound growth
  • Automate your investments — Set up automatic monthly contributions so you never miss a month of compounding
  • Track your budget — Use our Budget Planner to find extra money to invest each month

FAQ

Q: Is 7% annual return realistic? The S&P 500 has returned approximately 10% annually over the past 30 years before inflation. A 7% return is a conservative estimate after accounting for inflation and fees.

Q: Does this account for taxes? This calculator shows pre-tax returns. Using tax-advantaged accounts (401k, IRA, Roth IRA) can significantly reduce your tax burden on investment gains.

Q: Should I invest a lump sum or dollar-cost average? Historically, lump-sum investing outperforms dollar-cost averaging about 2/3 of the time. However, regular monthly contributions are more practical for most people and reduce timing risk.

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