The core formula (future value)

The engine of this calculator is the future value (FV) formula. It combines two pieces: (1) growth of what you already have (current invested amount), and (2) growth of what you add over time (monthly contributions). We assume monthly compounding because most people invest monthly (paycheck cadence), and it’s a good balance between realism and simplicity.

If your expected annual return is r, we convert it to a monthly rate i like this:

• i = (1 + r)^1/12 − 1

This is slightly more accurate than simply dividing by 12 because it preserves compounding. For small rates the difference is tiny — but this version stays correct as the rate changes.

Your current portfolio (PV) grows for n months:

• FV_PV = PV × (1 + i)ⁿ

Monthly investing is an annuity. If you contribute PMT each month, the future value is:

• FV_PMT = PMT × (((1 + i)ⁿ − 1) / i) (when i ≠ 0)

If the rate is 0%, we fall back to simple addition: FV_PMT = PMT × n.

• FV = FV_PV + FV_PMT

A future number can look huge, but inflation changes what it buys. We discount the future value by the inflation rate f over y years:

• FV_real = FV / (1 + f)^y

This is not perfect (inflation moves around), but it helps you compare “future dollars” to “today dollars” in a way your brain can actually use.

Hitting a target amount

If you enter a target amount, the planner calculates the monthly contribution required to reach it — under your chosen return and time horizon. This is the same future value equation, rearranged to solve for PMT:

• PMT = (Target − PV × (1 + i)ⁿ) × i / ((1 + i)ⁿ − 1) (when i ≠ 0)

If that PMT is negative, it means your current investments could reach the target with no additional contributions (under the assumptions). If it’s very large, that’s a signal to adjust one of the levers: invest more, extend the timeline, increase income, reduce expenses, or choose a more realistic target.

• Time: the most powerful lever for compounding.
• Contribution: the lever you control today.
• Return: partially controllable (risk, fees, diversification), but never guaranteed.

Realistic scenarios (so you can sanity-check)

Below are a few “mental math” examples to help you trust what you’re seeing. You don’t need these numbers to be exact — you need them to be plausible. If your results feel wildly off, check your inputs: (a) time horizon, (b) return assumption, (c) whether contributions are monthly or yearly, and (d) whether you entered dollars in the right field.

Age 25 → 65 (40 years), PV $0, PMT $300, return 7%.
A small monthly contribution looks boring — until time does its thing. Over 40 years, compounding dominates. In this type of setup, your contributions might total $144,000, but the ending portfolio can be much higher because growth has decades to multiply.

Age 35 → 65 (30 years), PV $50,000, PMT $300, return 7%.
The early lump sum gets 30 years of growth. Even if you don’t increase your monthly contribution, the lump sum can meaningfully change the end result. This is why “get invested” matters, even if the first contribution is small.

Target $500,000 in 25 years, PV $10,000, return 6%.
The calculator computes the monthly PMT needed. If it says “$X per month,” treat that as your baseline. If $X feels too high, extend to 30 years, or reduce the target, or increase income and revisit.

$1,000,000 in 30 years with 3% inflation is roughly equivalent to about $412,000 in today’s purchasing power (because (1.03)³⁰ ≈ 2.43). That’s why the “real value” number is so grounding: it tells you what the future might actually buy.

These are illustrative examples. Real-world results depend on volatility, sequence-of-returns risk, fees, taxes, and behavior.

Frequently Asked Questions

• Is this financial advice?

  No. This is an educational calculator to help you explore scenarios. It can’t account for your full situation.

• Why does changing return change results so much?

  Because compounding is exponential. A small difference in return, multiplied across hundreds of months, becomes a big gap. Use conservative assumptions and focus on what you can control: time and contributions.

• Does this include taxes and fees?

  Not directly. If you want a quick approximation, reduce the return slider by 0.5%–1.5% to simulate costs. Actual taxes and fees depend on account type, location, and your investments.

• What does the withdrawal rate mean?

  It’s a simple way to estimate sustainable annual income from a portfolio (e.g., 4% of the portfolio per year). It’s not guaranteed and can fail depending on market sequences, spending flexibility, and time horizon.

• Why show “inflation-adjusted”?

  Because your future portfolio needs to pay for future prices. Inflation-adjusting helps you compare everything in today’s dollars.

• What if the required monthly contribution is negative?

  That means your current portfolio could reach the target even if you invest $0 more (under the assumptions). In real life, you might still contribute as a buffer.

• What if my timeline is short?

  Short timelines reduce the power of compounding. If your target is near-term, consider increasing contributions, lowering your target, or using a more conservative return assumption.

Use this to make decisions clearer, not riskier

This planner is intentionally simple. It’s great for exploring “what if” scenarios and building a habit of investing. It does not model market crashes, sequence risk, taxes, changing contributions, or behavioral mistakes — which are often the biggest drivers of real-world outcomes.

• Run the plan once per quarter (or when income changes).
• Increase your contribution after raises (even by 1–2%).
• Keep fees low and diversify broadly.
• Use a conservative return assumption for “must-hit” goals.