Investment Calculator Lump Sum Regular Contributions Asset Allocation Inflation-Adjusted ...
Investment Calculator
Lump Sum Investment
Initial Investment (£)
Annual Return (%)
Investment Period (Years)
Compounding Frequency
Regular Contributions
Initial Investment (£)
Monthly Contribution (£)
Annual Return (%)
Investment Period (Years)
Contribution Timing
Asset Allocation
Total Investment (£)
Stocks Allocation (%)
Bonds Allocation (%)
Cash Allocation (%)
Expected Stock Return (%)
Expected Bond Return (%)
Expected Cash Return (%)
Inflation-Adjusted Returns
Initial Investment (£)
Monthly Contribution (£)
Nominal Annual Return (%)
Annual Inflation Rate (%)
Investment Period (Years)
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Investment Growth
Understanding Investment Growth Calculations
Investment growth calculations are essential for financial planning, helping you understand how your money can grow over time and make informed decisions about your investment strategy and retirement planning.
Lump sum investments demonstrate the power of compound interest on a single initial deposit. Regular contributions show how consistent investing, even with modest amounts, can build substantial wealth through dollar-cost averaging and compound growth over time.
Asset allocation helps you understand how diversifying your portfolio across different asset classes (stocks, bonds, cash) affects your overall return and risk profile. Inflation-adjusted calculations reveal the true purchasing power of your investment returns by accounting for the erosion of money's value over time.
Use these calculators to develop a strategic investment plan that aligns with your financial goals, risk tolerance, and time horizon.
Frequently Asked Questions
A: Nominal returns are your investment's actual percentage gain without adjusting for inflation. Real returns account for inflation and represent your actual increase in purchasing power. For example, if your investment returns 7% annually but inflation is 2.5%, your real return is approximately 4.39%.
A: More frequent compounding (daily vs. annually) results in higher returns over time because you earn interest on interest more frequently. The difference is small for short periods but becomes significant over decades of investing.
A: Regular contributions harness the power of dollar-cost averaging and compound interest. Even small, consistent investments can grow substantially over time. For example, investing £300 monthly at 7.5% for 30 years results in over £415,000, with more than 70% coming from investment returns rather than your actual contributions.
A: Asset allocation determines your portfolio's risk and return characteristics. A higher allocation to stocks typically provides higher long-term returns but with more volatility. Bonds provide stability and income, while cash offers liquidity and safety. The right allocation depends on your risk tolerance, investment goals, and time horizon.
A: Inflation erodes purchasing power over time. £100,000 today will only have the purchasing power of about £54,000 in 25 years with 2.5% annual inflation. Investment planning must account for inflation to ensure your future wealth maintains its real value and supports your desired lifestyle.
A: The effective annual rate accounts for compounding within a year and shows your true annual return. For example, 7% APR compounded monthly results in an EAR of 7.23%, which is the actual interest you'll earn over one year.
A: These calculations use standard compound interest formulas and are mathematically accurate. However, actual investment returns will vary based on market performance, fees, taxes, and other factors. These should be used as planning tools rather than guarantees.