A 30-year, $7,000-a-year example shows how account type and tax rates can shift the result by $70,000. Every investment account answers one question: when does the tax bill arrive? A traditional 401(k) or IRA deducts the money going in and taxes it coming out; a Roth taxes it going in and not coming out; an HSA can skip tax at all three steps when used for medical costs; a 529 skips tax on earnings spent on qualified education. The guide sets out the 2026 federal limits and income phase-outs published by the IRS, the new Roth catch-up rule for higher earners, the wider K-12 use of 529 plans, and a hypothetical comparison with its assumptions stated, so the gap between account types can be seen in dollars. Required distributions and the early-withdrawal penalty are covered in brief.
Investment growth calculator
How much could a lump sum plus monthly contributions grow to, and what is it worth after fees and inflation?
Real annual return, effective 3.08%
Assumptions & limits
What the calculator takes as given, what it leaves out, and where the rules it relies on come from.
Returns compound monthly and contributions are added at the end of each month.
The return, fee and inflation rates stay constant for the whole period. Real markets do not move in a straight line.
Fees are modelled as a reduction of the annual return (r − f), which is how an expense ratio works in practice.
The value in today's money divides the final balance by (1 + inflation) raised to the number of years.
Taxes, contribution increases and withdrawals are not included.
The result is an illustration of the arithmetic, not a forecast of returns.
How it works
The logic behind the result, step by step, with the formula the calculator uses.
FV = P · (1 + r)ⁿ + PMT · ((1 + r)ⁿ − 1) ÷ r
r = (annual return − annual fee) ÷ 12, n = years × 12
Value in today's money = FV ÷ (1 + i)ʸ
- FV
- Balance at the end of the period
- P
- Lump sum invested today
- PMT
- Monthly contribution, added at the end of each month
- r
- Monthly rate after fees
- n
- Number of months
- i, y
- Annual inflation rate and number of years
The calculator treats your investment as two parts that grow side by side. The first is the lump sum you invest today. It grows by the monthly rate every month until the end of the period. The second is the stream of monthly contributions. Each deposit starts compounding in the month after it is made, so early deposits grow for much longer than late ones.
The annual return you enter is divided by 12 to get a monthly rate, and the number of years is multiplied by 12 to get the number of months. When fees are switched on, the fee is subtracted from the annual return before that division. A 7% return with 1% in fees is therefore compounded at 6% a year, which is why small fees produce large gaps over long periods: the difference compounds too.
The three bars show the balance before fees, the balance after fees and the total you paid in. The gap between the first two is what fees cost over the whole period. The gap between the balance after fees and the total contributed is growth.
Inflation is applied last. The balance after fees is divided by (1 + i) for every year, which converts it into today's money: the amount that would buy the same things now. The real annual return shown below the bars is the effective yearly rate after fees and inflation, using the same monthly compounding as the balances above it.
Worked example
One full calculation with the default inputs, so you can check each step against the calculator.
You invest $10,000 today and add $500 at the end of every month for 20 years. The assumed return is 7% a year, fees are 1% a year and inflation is 3% a year.
| STEP | CALCULATION | RESULT |
|---|---|---|
| 01 | Months | 20 × 12 = 240 |
| 02 | Monthly rate before fees | 7% ÷ 12 = 0.583% |
| 03 | Monthly rate after fees | 6% ÷ 12 = 0.500% |
| 04 | Total contributed | $130,000 |
| 05 | Balance before fees | $300,851 |
| 06 | Balance after fees | $264,122 |
| 07 | Lost to fees | $36,728 |
| 08 | In today's money | $146,238 |
| 09 | Real annual return, effective | 3.08% |
The 1% fee reduces the final balance by $36,728, or 12.2% of what it would otherwise have been. After 20 years of 3% inflation, the $264,122 balance buys what $146,238 buys today.
Questions and answers
Short answers to the questions readers ask most about this calculation.
The fee is taken from the balance every year, so the money it removes can no longer compound. Over 20 years at the default inputs, a 1% fee reduces the final balance by about 12%, far more than 1% of what you paid in.
At the end. A deposit made at the start of each month would earn one extra month of growth, so the result would be slightly higher.
It is the final balance divided by the growth in prices over the period. It shows what the balance would buy at today's prices, which is usually more useful than the nominal figure for long horizons.
You can use it to see how contributions, fees and time interact. It does not include taxes, employer matching, contribution limits or changes in contributions, so it is not a retirement plan.
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