How Much Will Your Investment Grow?
Project investment growth with compound returns, monthly contributions, and dividend reinvestment.
The Magic of Compound Growth
Compound interest means your returns earn returns. $10,000 invested at 8% for 20 years grows to $46,610 — more than 4x your investment. Add $500/month and the total reaches $340,000+. The key insight: time matters more than amount. Starting 10 years earlier with half the monthly contribution produces more wealth than starting later with double the contribution.
Realistic Return Expectations
S&P 500 historical return: ~10% annually (nominal), ~7% after inflation. Total stock market: 9-10%. Bonds: 4-6%. 60/40 portfolio: 7-8%. Savings account: 1-5% (varies with rates). For long-term planning (10+ years), using 7-8% for a diversified stock portfolio is reasonable and conservative.
The most powerful force in investing is not a high return — it is time. $100/month at 10% from age 25 to 65 grows to $632,000. The same $100/month from age 35 to 65 grows to only $227,000. The 10 extra years of compounding — with zero additional contributions — adds $405,000. Start early, even if the amount is small.
