Understanding the power of compound interest and regular investments is crucial for building long-term wealth. This calculator helps you visualize how your investments grow over time — with inflation adjustment, benchmark comparison, tax estimates, and preset scenarios for different investor profiles.
Earn returns not just on your initial investment, but also on your accumulated earnings over time.
Consistently adding to your investments significantly boosts long-term returns through dollar-cost averaging.
Nominal returns look great on paper. Real returns (adjusted for inflation) show your actual purchasing power growth.
Capital gains taxes reduce your final return. Knowing your after-tax outcome helps you plan realistically.
Core Parameters
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| Period | Amount Invested | Interest Earned | Balance (Nominal) | Balance (Real) |
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Nominal returns are what your account shows. Real returns subtract inflation — if you earn 8% but inflation is 3%, your real purchasing power grows at about 5% per year.
The S&P 500 has averaged ~10% annually over the long term. Bonds average ~4%. These benchmarks help you gauge whether your return assumption is realistic.
Long-term gains (assets held 1+ year) qualify for lower tax rates (0–20%). Short-term gains are taxed as ordinary income. Tax-advantaged accounts (IRA, 401k) defer or eliminate this.
Visual representation of how your investment grows. The gap between the "Total Balance" and "Amount Invested" lines shows the power of compounding returns over time.