Free online tool that calculates how much your savings or investment will grow over time using compound interest, based on your inputs.
| Year | Balance | Interest Earned | Real Value (Inflation Adj.) |
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Click "Calculate" to see your investment growth |
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Future value = P(1 + r/n)^(nt) + PMT × [((1 + r/n)^(nt) − 1) ÷ (r/n)]
The exact terms used depend on the contribution and compounding frequency selected.The estimate uses the starting balance, contribution or withdrawal schedule, time horizon and assumed rate entered. Compounding frequency, contribution timing, inflation, fees, taxes and employer or program rules affect how closely the estimate resembles a real account.
Use the Future Value Calculator to project the value of a lump-sum investment, an series of contributions, or both will grow at a future time and at a particular annual rate of return. The inputs to the future value calculator include initial investment amount, expected annual rate, investment time frame and contributions amount, if any. The calculator can display the anticipated future value of the investment and assist you with determining how a change in the interest rate or returns percentage, the time, contribution amounts, or number of compounding periods, will change the end result. This a calculation, not a guarantee of future interest or return rates, etc.
Use the same periods in all of the calculation. For instance, if your contributions is made on monthly basis and your interest compounded on monthly basis, the periodic interest rate and periods will both used from monthly basis.
When a certain rate of interest is earned over a specified number of compounding periods, it will help to find the approximated future value of your money by using this Future Value Calculator. If there are regular contributions made towards it then the time and the amount for the contribution made to the calculator also becomes the part of the calculation.
The calculation is largely dependent on factors such as initial balance, rate, periods, amount invested, when the money is invested, and the frequency of compounding. Increasing the time frame of the investment enables more time to compound earnings and using a higher assumed rate will yield a greater calculated future value. Returns of actual investments will differ from assumed returns.
For a single lump-sum amount with periodic compounding, the standard future value formula is:
FV = PV × (1 + r)n
FV is the future value.
PV is the present value or initial amount.
r is the interest or growth rate per compounding period, expressed as a decimal.
n is the total number of compounding periods.
If you’re presented with an annualized interest rate that compounds more than once a year, theperiodic rate usually is found by multiplying the annualized interest rate by the number of times a period would be compounded per year, use an appropriate number in the exponent.
For regular contributions, the future value of an ordinary annuity can be represented as:
FV = PMT × ((1 + r)n - 1) ÷ r
PMT indicates the amount paid every period. This formula is the equation assuming the payment made at the end of every period. When it is made at the beginning of every period, different treatment on timing may be required.
Suppose you deposit $10,000 into an account and assume an annual return of 5%, compounded annually, for 10 years. No additional contributions are made.
Inputs: Initial amount = $10,000; annual rate = 5%; time = 10 years; compounding = annual.
Formula: FV = PV × (1 + r)n
Calculation: FV = $10,000 × (1 + 0.05)10
FV = $10,000 × 1.6288946268
Estimated future value: approximately $16,288.95.
So, on those terms, the mathmatically predicted outcome is just under $16,288.95. Remember that doesn't necessarily mean that this is what an investment will achieve-markets will go up and down and fees, tax and/or cash withdrawn and used will obviously impact on a true financial investment.
Regular contributions can significantly alter the future projected value, because every contribution may earn a different interest over a period of time. It should be noted, that previous deposits are generally given a larger time span to compound compared to new deposits.
For example, two investments that share the same annual percentage rate and number of years could result in very different ending amounts if one involves regular deposits throughout each period and the other involves only the initial amount. You also need to consider whether contributions and contributions are made monthly or annually and the amount of interest deposited each month rather than periodically by year-end.
The definition of how often collected interest or growth becomes compounded in a balance for further purposes of calculations is the method of compounding. In case of nominal annual interest rate, altering compounding changes the result of calculation, since the period interest rate and period count differ.
Do not compare the answers to two future value problems unless you can ascertain if they use the same rate convention and compounding frequency. You do not enter an annual rate with monthly compounding in the same manner as a monthly rate.
Future value refers to the output of the calculator with the given inputs. Future value may consist of your initial principal investment plus the mathematical growth on that investment and any regular future payments you make.
The higher the rate assumed, the greater the calculated future value when the other inputs are held constant. Similarly, the greater the period of the investment or the contribution, the higher the forecasted value will be. These relationships should not be taken as a promise of market performance.
When comparing scenarios, change one major input at a time when possible. For example, compare the same starting balance and time period using different assumed rates, or compare different contribution amounts while keeping the other assumptions constant.
The accuracy of your projected future value relies on your assumptions. When you use a consistent rate, the system is predicting, not actualizing, your returns for every time period you use in the calculation, even though real world investment returns will probably fluctuate from year to year. There are also likely taxes, fees, contributions, distributions or any number of factors at play in a real world account that are not part of a simple mathematical equation.
As such, the output needs to be viewed as an estimate of how an account could theoretically stand, not as an account of its current balances. For purposes of an investment account, a hypothetical gain is in no way representative of future investment performance.
Future value is the value which a current sum would grow to through compounding or investment return over a period of time. It is used to determine: How much will my investment be worth in Y years if I invest $X today?
Simply put the simple formula is for you FV = PV (1 + r)^n. Where PV is your present value (your starting point), r the interest rate per period and n the number of periods. If you make regular deposits, then the calculator basically puts an annuity formula above this.
FV is forward-looking-what money will be worth. PV is backward-looking-what a future amount is worth today. They're really the same compounding calculation just done backwards.
Yes, definitely over long time horizons. Monthly compared to annual compounding at the same rate accumulates to a few percentage points extra growth over a 20–30 year investment horizon just because the interest is earning interest earlier.
I think the range for savings accounts should be 1-5% and for stock market investments many planners will use a long term historical average over years prior to inflation of about 7-10% but actual returns are not consistent over each individual year.
Yes. Enter your current retirement savings, your planned monthly contribution, an expected return, and your years until retirement. The result gives you a realistic target to compare against your retirement income goals.
Create a base case with the contribution and return assumption you consider reasonable. Then test a lower return, a later start or a higher contribution to see which change has the largest effect on the projected value.
The future value calculator uses a standard compound interest formula. For a lump sum with no ongoing contributions, the formula is:
FV = PV × (1 + r)n
If you're adding regular contributions, the calculator adds an annuity component on top of this, so each new deposit compounds for the time remaining until your end date.
Say you invest $5,000 today, add $200 a month, expect a 7% annual return, and plan to invest for 15 years with monthly compounding.
| Input | Value |
|---|---|
| Starting amount | $5,000 |
| Monthly contribution | $200 |
| Annual return | 7% |
| Time period | 15 years |
| Compounding | Monthly |
Running these numbers through the formula gives a projected future value of roughly $77,000. Of that, only about $41,000 came from money you actually put in the rest, around $36,000, came purely from compounding. That gap is what makes starting early so powerful.
A useful habit: compare the interest-earned figure to your contributions. The larger that ratio, the more your money is working for you rather than the other way around.