Average Return Calculator
Calculate the average annual return on an investment over a specified period.
Average Return Calculator
Calculate the average annual return on an investment over a specified period.
Compound Growth Formula
ℹ️ Assumes monthly compounding. Past returns do not guarantee future results.
Disclaimer
Results provided by this calculator are for informational and educational purposes only. They are based on the values you enter and standard formulas, and should not be considered financial, medical, legal, or professional advice. Always consult a qualified professional before making important decisions based on these results. Roughtools makes no warranties regarding the accuracy or completeness of these calculations for your specific situation.
Frequently Asked Questions
Pro Tips
Time in the market beats timing the market. Missing just the 10 best trading days over 20 years can cut your returns in half. Stay invested through downturns.
Tax-advantaged accounts (401k, Roth IRA) let your investments grow tax-free or tax-deferred — always max these before investing in taxable accounts.
The Rule of 72: divide 72 by your annual return to estimate years to double. At 7%, money doubles every ~10.3 years. At 10%, every 7.2 years.
Increase your contribution by just 1% of salary each year you get a raise. You won't notice the difference in take-home pay, but it compounds dramatically over decades.
When to Use This Calculator
See how even small monthly contributions grow dramatically over time with compound returns — motivation to start immediately.
Calculate how much to save monthly to reach a college fund target in 10–18 years at a realistic return rate.
Project your portfolio balance at retirement based on current savings rate and expected returns.
Compare the outcome of investing a windfall now versus spreading it as monthly contributions over time.
Compare outcomes at different return rates (5%, 7%, 9%) to understand the impact of investment choice on final balance.
About the Average Return Calculator
This average return calculator computes the Compound Annual Growth Rate (CAGR) — the true annualized return on any investment — from the starting value, ending value, and time period. Enter your investment's beginning and ending values and the number of years to get the exact annualized return rate. Ideal for evaluating portfolio performance, real estate returns, and business growth rates.
How to Use the Average Return Calculator
- 1
Enter the starting value of the investment (initial purchase price or portfolio value).
- 2
Enter the ending value (current or final value).
- 3
Enter the number of years the investment was held.
- 4
The calculator shows CAGR, total return percentage, and total gain/loss.
- 5
Compare the CAGR to benchmarks like the S&P 500 (~10%/year historically).
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