What is a good annual return on investment?

Historically, the S&P 500 has returned about 10% per year before inflation and roughly 7% after inflation. For planning, many use 6–8% as a realistic long-term expected return. Conservative portfolios may assume 4–5%; aggressive growth assumptions might use 10–12%.

How much will $1,000 grow in 10 years?

At 7% annual return, $1,000 grows to about $1,967 in 10 years with no additional contributions. At 8%, about $2,159. Use the investment calculator above and set monthly contribution to $0 to see lump-sum growth.

Is 8% return realistic?

Yes. The S&P 500 has averaged about 10% nominal return per year over many decades. After inflation, that’s roughly 7%. Using 8% for long-term (20+ year) stock investing is a common, reasonable assumption. Short-term returns vary widely.

How does inflation affect investments?

Inflation reduces purchasing power. A 7% return with 3% inflation gives roughly 4% real return. The calculator’s inflation toggle shows your ending balance in today’s dollars so you can see real (inflation-adjusted) growth.

What is compound interest?

Compound interest is interest earned on both your principal and on previously earned interest. Formula: A = P(1 + r/n)^(nt). The more often interest compounds (e.g. monthly or daily), the higher the ending balance for the same stated rate.

Is investing monthly better than yearly?

Investing monthly (dollar-cost averaging) smooths out price swings and often results in a similar or better outcome than investing one lump sum per year. The calculator shows the impact of monthly contributions vs initial-only.

What is the Rule of 72?

The Rule of 72 estimates how long it takes to double your money: divide 72 by your annual return rate. At 8%, 72/8 = 9 years to double. At 6%, about 12 years. It’s an approximation for quick mental math.

How much will $10,000 grow in 20 years?

At 7% return with no additional contributions, $10,000 grows to about $38,697. At 8%, about $46,610. Add monthly contributions in the calculator to see combined growth.

If I invest $500 a month for 10 years how much will I have?

At 8% return, $500/month for 10 years ($60,000 total contributions) grows to about $91,473. At 7%, about $86,542. Use the calculator with initial investment $0, monthly $500, 10 years, and your chosen rate.

How much will I have if I invest in the S&P 500?

The S&P 500 has historically returned about 10% per year (before inflation). Use the calculator with an 8–10% annual return to approximate long-term S&P 500 growth. Past performance does not guarantee future results.

2026 · Free

Investment Calculator (With Monthly Contributions & Compound Interest)

See how much your investment will grow with a future value calculator that supports monthly contributions, compound interest (annual, quarterly, monthly, daily), and optional inflation and tax.

Use our paycheck calculator, 401k calculator, bonus tax calculator, and net worth calculator to plan your full financial picture.

Investment amount & contributions

Initial investment and monthly contribution (e.g. from your paycheck).

Initial investment ($)

Monthly contribution ($)

Return rate & term

Expected annual return and investment length. Use presets or enter a custom rate.

Annual return (%)

Years

Compounding

Optional: inflation & tax

See inflation-adjusted (today's dollars) and after-tax value.

Inflation

Capital gains tax

Results

After 20 years with monthly compounding

Ending balance

$343,778

Total contributions

$130,000

Interest earned

$213,778

Growth over time

Projected balance by year

Year-by-year breakdown

Balance and interest by year (first 30 years shown)

Year	Balance	Contributions	Interest
0	$10,000	$10,000	$0
1	$17,055	$16,000	$1,055
2	$24,695	$22,000	$2,695
3	$32,970	$28,000	$4,970
4	$41,932	$34,000	$7,932
5	$51,637	$40,000	$11,637
6	$62,148	$46,000	$16,148
7	$73,531	$52,000	$21,531
8	$85,859	$58,000	$27,859
9	$99,210	$64,000	$35,210
10	$113,669	$70,000	$43,669
11	$129,329	$76,000	$53,329
12	$146,288	$82,000	$64,288
13	$164,655	$88,000	$76,655
14	$184,546	$94,000	$90,546
15	$206,088	$100,000	$106,088
16	$229,419	$106,000	$123,419
17	$254,685	$112,000	$142,685
18	$282,049	$118,000	$164,049
19	$311,684	$124,000	$187,684
20	$343,778	$130,000	$213,778

How compound interest works

Compound interest is interest earned on your principal plus on interest you’ve already earned. The formula is A = P(1 + r/n)^(nt): A = future value, P = principal, r = annual rate (as a decimal), n = compounding frequency per year, t = years. With monthly contributions, the future value of the series is added: each contribution grows from the time it’s invested until the end. Example: $500 per month for 30 years at 8% (monthly compounding) gives about $745,800—total contributions $180,000, so interest earned is about $565,800. Example: $10,000 lump sum for 20 years at 8% grows to about $46,610. Use the calculator above to try your own numbers.

Historical stock market returns (S&P 500)

The S&P 500 has averaged about 10% per year nominal return over long periods. After inflation (roughly 3% historically), that’s about 7% real return. Our “Average market (8%)” preset is a common assumption for long-term stock investing. Short-term returns vary; use the calculator for long-term projections and consider the inflation toggle to see purchasing power. An S&P 500 return calculator or investment return calculator like this one helps you answer “how much will my investment grow?”

How much should you invest per month?

A common guideline is to invest 10–20% of gross income. 10% is a minimum many advisors suggest; 15% is a solid target for retirement; 20% or more accelerates wealth building. Use our paycheck calculator to see take-home pay, then decide what you can comfortably invest each month. This monthly investment calculator shows the impact of different contribution amounts over time.

Investment strategies by age

20s: Time is your biggest advantage. Aggressive (higher stock allocation, e.g. 10–12% expected return in the calculator) and consistent monthly investing can build significant wealth. 30s: Balance growth with stability; 8% is a reasonable default. Max employer 401k match, then IRA or taxable. 40s: Continue 6–8% assumptions; increase contributions if you started late. 50+: Consider a slightly lower expected return (5–7%) and use the inflation toggle to plan in today’s dollars. Use our 401k calculator to model employer match and growth.

Impact of inflation on investments

Inflation reduces the real value of future dollars. A 8% nominal return with 3% inflation is roughly 5% real return. The calculator’s inflation rate option converts your ending balance into today’s purchasing power so you can see inflation-adjusted growth. For long-term goals (e.g. retirement in 20–30 years), always consider inflation when judging whether your target is enough.

Investment taxes explained

In taxable accounts, investment gains can be taxed as capital gains (long-term rates often 0%, 15%, or 20%) or as ordinary income (e.g. short-term gains, interest). The calculator’s optional capital gains tax rate applies a flat rate to your total gain (ending balance minus total contributions) to show after-tax value. For IRA/401k, tax is deferred until withdrawal. Use our capital gains tax calculator or bonus tax calculator for more detail on tax impact.

Lump sum vs monthly investing

Lump sum investing (e.g. $10,000 today) can capture full market growth if the market rises. Monthly investing (dollar-cost averaging) spreads risk and often yields similar long-term results while fitting paycheck flow. Use the calculator: set initial to $10,000 and monthly to $0 for lump sum; set initial to $0 and monthly to $500 (or any amount) to see invest $X per month growth. Many people do both—an initial amount plus regular contributions.

Frequently asked questions

Next steps: use your paycheck to invest

Know how much you can invest each month by estimating take-home pay and tax. Then revisit this investment calculator to see how that amount grows over time.