Investment Calculator
Calculate your investment growth with compound interest, regular contributions, and dividend reinvestment. Plan your financial future with detailed projections and compare different investment scenarios.
Investment Details
Enter your investment parameters
Investment Tips
Start Early
Time is your greatest asset. The earlier you start, the more you benefit from compound interest.
Diversify
Spread risk across different asset classes and geographic regions.
Regular Contributions
Consistent monthly investments help smooth market volatility through dollar-cost averaging.
The Power of Compound Interest
Compound interest is often called the "eighth wonder of the world." It's the process where your investment earnings generate their own earnings.
- Interest on Interest: You earn returns not just on your original investment, but also on previously earned returns
- Time Matters: The longer your money is invested, the more dramatic the compounding effect becomes
- Regular Contributions: Adding money regularly accelerates the compounding process
- Start Early: Even small amounts invested early can outperform larger amounts invested later
Asset Allocation Guidelines
Diversification across different asset classes can help manage risk while pursuing returns:
- Conservative (Age 60+): 20% stocks, 80% bonds/cash
- Moderate (Age 40-60): 60% stocks, 40% bonds/cash
- Aggressive (Age 20-40): 80% stocks, 20% bonds/cash
- Rule of 100: Subtract your age from 100 for stock percentage
- International: Consider 20-30% in international investments
- Real Estate: REITs can add diversification (5-15% allocation)
Risk Management
Understanding and managing investment risk is crucial for long-term success:
- Dollar-Cost Averaging: Invest regularly regardless of market conditions
- Emergency Fund: Keep 3-6 months expenses in savings before investing
- Time Horizon: Longer investment periods can weather short-term volatility
- Rebalancing: Periodically adjust your portfolio back to target allocation
- Avoid Timing: Trying to time the market often reduces returns
Investment FAQs
What's a realistic return expectation?
Historically, the stock market has averaged 7-10% annually over long periods, but past performance doesn't guarantee future results.
How much should I invest monthly?
Financial advisors often recommend investing 10-20% of your income, but start with what you can afford consistently.
When should I start investing?
The best time to start investing is as soon as possible. Time in the market generally beats timing the market.