Investment Growth Calculator

Why this calculator is different

An investment growth calculator assumes you are investing in the stock market (or a mix of stocks and bonds), not depositing money in a savings account. That matters because market returns are volatile year to year, but over long periods they average out to something predictable.

For a US stock portfolio, the long-term average return after inflation is around 7% per year. A 60/40 mix of stocks and bonds returns about 5–6%. A pure bond portfolio returns closer to 3%.

What "expected return" really means

The "expected return" input is a long-term average, not a promise. In a typical 30-year period:

• 5–10 years might be below average or negative
• 5–10 years might be well above average
• The rest cluster around the mean

If the 30-year average works out to 7%, your final balance looks like what this calculator shows — but the path to get there is bumpy.

How much should you invest?

A common starting target is 15% of gross income for retirement. That includes employer 401(k) matches. For example, if you earn $60,000 and your employer matches 3%, you should contribute 12% yourself to hit the 15% total.

If that sounds like a lot, start lower and increase 1% every year. Most people barely notice a 1% raise in contribution rate.

Common mistakes to avoid

• Timing the market. Trying to buy low and sell high reliably is nearly impossible, even for professionals. Consistent monthly contributions (dollar-cost averaging) beats timing in most cases.
• Panic-selling in downturns. The worst investment mistake is selling when the market drops. Historically, every major crash has recovered and made new highs.
• Chasing hot stocks. Individual stocks underperform index funds most of the time. Unless you deeply understand what you are buying, index is usually the safer path.