A 1% or 2% difference between two rates of return may seem insignificant at first glance. The reality is that this difference can have a major impact on the final value of your investment or retirement fund, especially over the long term. Keeping your money in a "no risk" investment may keep your money safe, but it may increase the risk of not having enough money to meet your retirement needs. With "safe" investments there is a risk of having a very low or even negative rate of return because of taxes and inflation. By including some investments with higher returns and longer term growth potential in your portfolio, you reduce the risk of an income shortage during retirement. Change the numbers in this calculator to see the dramatic impact of a higher rate of return.
Single Deposit Amount: Enter the amount of your initial investment. If you are not investing anything yet, you can enter "0."
Years of Growth: Enter the number of years until you cash out your investment. Of course, in reality, you will more likely cash out your investment slowly, which will let you keep gaining income from it. But the purpose of this calculator is just to let you see how differences in interest rates affect differences in outcomes.
Rate of Return 1: Enter an annual rate of return, for instance, your current rate of return on your investment, as a percentage.
Rate of Return 2: Enter an annual rate of return, for instance, the rate of return on an investment you are considering, as a percentage.
Regular Deposit Amount: Enter the amount you will be depositing either each year or each month. If you will not be making any deposits after your initial investment, enter "o."
Regular Deposit Type: Enter whether you will make the deposit you listed above yearly or monthly.
Make Deposits When? Enter whether you will make the deposit you listed above at the beginning or end of the year/month.