SimpleCalc.co

Investment Calculator

Investment Calculator
Project the future value of your investments with compound interest.

You might also like...

Compound Interest Calculator
Calculate the future value of your savings.
Retirement Planner
Project if your savings are on track for retirement.
Savings Goal Calculator
See how long it will take to reach your goal.
Net Worth Calculator
Calculate your net worth from assets and liabilities.
Understanding Compound Interest

Compound interest is the interest on a loan or deposit calculated based on both the initial principal and the accumulated interest from previous periods. Albert Einstein famously called it "the eighth wonder of the world."

How It Works

When you invest, you earn a return on your initial investment. With compound interest, you also earn a return on that return. Over time, this effect can accelerate your wealth growth significantly compared to simple interest.

Key Factors

The growth of your investment is influenced by three main factors: the amount of money you invest (principal), the rate of return (interest rate), and the length of time you stay invested (term). Regular contributions also dramatically increase the final amount.

Logic & Formulas

The calculator finds the future value by combining two standard financial formulas: the future value of a single sum (your initial investment) and the future value of a series of regular payments (your monthly contributions).

  1. Future Value of Initial Investment:

    FV_initial = P * (1 + r)^n

  2. Future Value of Contributions:

    FV_contributions = C * [((1 + r)^n - 1) / r]

Where:

  • P = Initial Investment
  • C = Monthly Contribution
  • r = Monthly Interest Rate (Annual Rate / 12)
  • n = Number of Months (Investment Term * 12)

The total future value is the sum of these two results. The total interest is this final value minus the sum of all money you put in (initial investment + total contributions).