The power of compounding
Compound interest means you earn returns on your past returns, not just your contributions. The longer the time horizon, the more the growth curve bends upward โ which is why starting early beats contributing more later.
A realistic return assumption
Historically the S&P 500 has averaged roughly 7% after inflation over the long run, but returns are volatile year to year. Use a conservative rate for planning and treat the result as a range, not a promise.
Frequently asked questions
Is this good for a 401(k) or IRA?
Yes โ set your starting balance, monthly contribution and an expected return to project the balance at retirement. It doesnโt model employer matching or taxes.
How often does it compound?
Monthly, with contributions added at the end of each month โ a close match to how most retirement accounts behave.