Model compounding with flexible deposits and rates easily. Add fees, taxes, and inflation quickly today. Download reports and track your progress across every year.
| Scenario | Initial | Deposit | Rate | Years | Notes |
|---|---|---|---|---|---|
| Starter plan | $5,000 | $150 monthly | 7% | 15 | Low fee, no tax, modest step-up. |
| Balanced plan | $20,000 | $500 monthly | 8% | 20 | Includes inflation and a small annual fee. |
| Aggressive plan | $50,000 | $1,000 monthly | 10% | 25 | Higher growth, add tax to stress-test outcomes. |
This tool simulates month-by-month growth using an effective monthly rate.
Effective monthly rate:
rm = (1 + r/m)^(m/12) - 1
Monthly update (simplified):
balance = (balance + deposit_begin) * (1 + rm)
fee_amount = balance * fee_m
balance = balance - fee_amount + deposit_end
Inflation-adjusted value:
real = ending / (1 + inflation)^years
This calculator separates the three main levers of compounding: starting balance, recurring deposits, and time. Try doubling deposits while keeping rate constant to see how cashflow often dominates returns over long horizons. Use the schedule table to spot when the curve steepens; the acceleration typically appears after year 8-12. Comparing scenarios with equal total contributions highlights how earlier deposits receive more compounding cycles and usually win. Small delays reduce final wealth materially.
Rates are entered annually, then converted into an effective monthly rate based on the selected compounding method. Monthly compounding is straightforward, while daily and weekly compounding slightly increase the effective monthly return for the same nominal rate. Continuous compounding uses an exponential conversion, which is useful for theory comparisons. If you need to match a product quote, keep compounding consistent with the statement’s period definition. One percent differences compound dramatically over decades.
Contribution frequency and timing change the number of growth periods each deposit experiences. Deposits at the beginning of the period earn interest immediately, which tends to lift outcomes versus end-of-period deposits. Quarterly or annual deposits create lumpier growth but should converge when totals match, especially over long horizons. The annual step-up option models raises or planned savings increases, keeping contributions realistic as income rises. Test 0, 3, and 6 step-ups each year.
Nominal balances can mislead when prices rise, so the calculator also shows inflation-adjusted ending wealth. Real value discounts the ending balance by the assumed inflation rate over the same horizon, helping you compare purchasing power across plans. Use this to test whether higher contributions offset inflation drag. A practical check is to run identical inputs with inflation set to 0% and then to 3-6%. If real value falls, adjust assumptions upward quickly.
Fees and taxes create return drag that compounds just like gains. An annual fee of 0.50% can reduce long-run outcomes by several years of progress, especially when rates are modest. Tax-at-end models a single realization event, while annual tax approximates recurring taxation on positive yearly gains. The money-weighted return (IRR) summarizes your experience, incorporating deposit timing and portfolio growth into one comparable metric. Use it to compare plans with deposit schedules.
It is the projected portfolio value after all deposits, fees, and any selected taxes. The schedule shows how the balance evolves year by year under the same assumptions.
IRR is money-weighted, so deposit timing matters. Large deposits made later have less time to grow, pulling IRR closer to the later-period performance than the headline rate.
The annual fee is converted to an equivalent monthly rate and applied after interest accrual. This approximates ongoing expense drag, similar to how many funds deduct expenses continuously.
At each year-end, the model estimates gains as ending balance minus starting balance and that year’s deposits. Only positive gains are taxed, then the balance is reduced. It is a simplified planning approximation.
Use the method that matches your rate quote or product disclosure. For most long-term planning, monthly is a practical default, while daily or continuous can help compare theoretical differences.
Yes. Choose One-time for a single deposit in month one, or select quarterly, semiannual, or annual frequency. For irregular patterns, run multiple scenarios and combine results externally.
Important Note: All the Calculators listed in this site are for educational purpose only and we do not guarentee the accuracy of results. Please do consult with other sources as well.