Project what today's money grows into at a given rate and horizon.
Future value tells you what a sum of money — invested today at a given rate — will be worth after a specified period. Compounding means the interest itself earns interest, so growth is exponential rather than linear. More frequent compounding produces a slightly higher future value because you earn interest on interest sooner.
Future value of a lump sum
FV = PV × (1 + r)^n
Future value with periodic contributions
FV = PV × (1+r)^n + PMT × [(1+r)^n − 1] / r
The US stock market has historically returned about 10% annually before inflation and about 7% after inflation. For a diversified portfolio, 6–8% is commonly used for long-term planning. Conservative projections use 4–5%. Always stress-test your plan at a lower rate.
For stock returns, compounding frequency doesn't apply in the traditional sense — returns reinvested depend on when dividends are paid and when you reinvest. For savings accounts and CDs, more frequent compounding gives a higher APY on the same nominal rate.
To find real (inflation-adjusted) future value, use the real return rate: real rate ≈ nominal rate − inflation rate. If you expect 7% nominal returns and 3% inflation, enter 4% as your growth rate. The result is in today's dollars.
A quick mental shortcut: divide 72 by the annual rate to estimate how many years it takes to double your money. At 7%, money doubles in about 72 ÷ 7 ≈ 10.3 years. This calculator gives the exact answer.