How the calculator works
The calculator compounds the entered annual rate monthly and adds the monthly investment at the end of each month. It separates your estimated ending balance into total contributions and hypothetical investment growth.
Why test several return assumptions?
No one knows what future market returns will be. Historically, the S&P 500 has returned roughly 10% per year on average over the long term, although actual returns can vary dramatically from year to year.
That is why this calculator lets you try different return assumptions. Using a lower rate can show a more conservative outcome, while a higher rate can show how much long-term results depend on market performance.
Historical returns do not guarantee future results.
Historical reference: Fidelity — S&P 500 average return.
What the calculator does not include
Taxes, inflation, fund expenses, withdrawals, changing contribution amounts, market volatility, and sequence-of-returns risk are not modeled. Treat the result as an educational illustration, not a retirement projection.