Investment Details
How much you're starting with today
Amount you'll add each period
How often you'll add money
S&P 500 avg: 10%, after inflation: 7%
Longer = more compound growth
How often interest is calculated on your balance
Advanced: Inflation & Tax Adjustments
Average US inflation: ~3%. Set to 0 to ignore.
Long-term: 0-20%. Set to 0 to ignore.
Future Value
$113,952
Doubles in 10.3 years (Rule of 72)
Total Contributions
$58,000
Total Interest Earned
$55,952
Interest % of Total
49.1%
Effective Annual Return
7.23%
Contributions vs Interest
Growth Over Time
Contributions
Interest Earned
Year-by-Year Breakdown
| Year | Contributions | Interest | Balance |
|---|
Goal Calculator: How Much Do I Need to Save?
Enter a target amount and we'll calculate how much you need to save each month to reach it.
Monthly Saving Needed
$0
Total You'll Invest
$0
Interest Earned
$0
Interest % of Goal
0%
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Frequently Asked Questions
What is compound interest?
Compound interest is interest calculated on both the initial principal AND the accumulated interest from previous periods. Unlike simple interest (which only applies to the principal), compound interest allows your money to grow exponentially over time. Albert Einstein reportedly called it "the eighth wonder of the world."
What is the Rule of 72?
The Rule of 72 is a quick formula to estimate how long it takes for an investment to double. Simply divide 72 by the annual interest rate. At 7% annual return, your money doubles in approximately 72 ÷ 7 = 10.3 years. At 10%, it doubles in 7.2 years.
Does compound frequency matter?
Yes, but less than you might think. More frequent compounding (daily vs. annually) means slightly more interest earned. For a $10,000 investment at 7% over 20 years: Annual compounding gives $38,697 vs. daily compounding gives $40,552 — a difference of $1,855 (about 5% more).
What's a realistic annual return to expect?
Historical averages: S&P 500 (stocks): ~10% annually. Bonds: ~5%. High-yield savings: ~4-5% (2026). Adjusted for inflation (~3%), real stock returns average ~7%. Our calculator defaults to 7% for conservative long-term planning.
How much should I invest monthly?
A common guideline is the 50/30/20 rule: 50% of income for needs, 30% for wants, 20% for savings and investments. But even small amounts matter — $200/month at 7% for 30 years grows to over $227,000. Start with what you can afford and increase over time.
The Power of Compound Interest
Compound interest is the single most powerful force in wealth building. Unlike simple interest, which only earns on your initial deposit, compound interest earns interest on your interest — creating exponential growth over time.
The Compound Interest Formula
A = P(1 + r/n)^(nt), where:
- A = Final amount
- P = Initial principal (starting amount)
- r = Annual interest rate (decimal)
- n = Compounding frequency per year
- t = Time in years
Why Starting Early Matters
Consider two investors, both saving $300/month at 7% return:
- Investor A starts at age 25 and stops at 65: $745,179
- Investor B starts at age 35 and stops at 65: $340,284
Investor A invested only $36,000 more but ends up with $404,895 more — that's the power of 10 extra years of compounding.