How is investment return calculated?

Total return = (Final Value − Initial Investment) ÷ Initial Investment × 100. For example, if you invest €10,000 and it grows to €16,105 over 10 years, your total return is 61.05%. Our calculator also shows the annualised return (CAGR) so you can compare investments of different lengths.

What is CAGR and how is it calculated?

CAGR (Compound Annual Growth Rate) is the annualised rate of return of an investment. Formula: CAGR = (Final Value / Initial Value)^(1/Years) − 1. For example, €10,000 growing to €18,000 over 8 years gives a CAGR of (18,000/10,000)^(1/8) − 1 = 7.6% per year.

What is a realistic annual return on investment?

Historically, a globally diversified stock index fund has returned approximately 7–10% per year before inflation over the long term. After inflation (approx. 2–3%), real returns are typically 5–7%. Savings accounts and bonds return less (1–4%). Higher returns come with higher risk.

Is it better to invest a lump sum or make regular contributions?

Both approaches have merit. A lump sum invested immediately maximises time in the market, which historically outperforms regular investing about 2/3 of the time. Regular contributions (pound/euro cost averaging) reduce timing risk and are ideal if you are building savings gradually. Our calculator models both scenarios.

How does inflation reduce my investment return?

Inflation erodes purchasing power. A nominal return of 8% with 2.5% inflation gives a real return of approximately 5.4%. Our investment calculator lets you set an inflation rate so you can see the real (inflation-adjusted) value of your portfolio at the end of the investment period.

💹 Investment Return Calculator

Free, accurate, GDPR compliant. All calculations run in your browser — no data is ever stored or shared.

Initial Investment (€)

Investment Period (years)

Monthly Contribution (€)

Expected Annual Return (%)

Inflation Rate (%)

⚠️ Risk Warning (MiFID II): Capital is at risk. Past performance does not guarantee future returns. Projections are illustrative only. Not financial advice.

About the Investment Return Calculator

The Investment Return Calculator is free to use and all calculations run entirely in your browser. This tool calculates the total return on an investment, taking into account your initial lump-sum, any regular contributions, the investment period, and an assumed annual rate of return. It uses compound interest to project how your money grows over time.

The Power of Compound Growth

Compounding means your returns generate further returns. Over long time horizons, this effect is dramatic. A €10,000 investment growing at 7% per year doubles roughly every 10 years. Starting early — even with small amounts — is consistently more impactful than investing larger sums later in life.

Key Metrics Explained

Total invested — the sum of your initial amount and all regular contributions over the period
Final value — the projected portfolio value after compound growth
Total return — the gain expressed in currency terms
Return on investment (ROI) — the percentage gain relative to the total amount invested
Annualised return — the equivalent yearly growth rate, useful for comparing different investments

Choosing a Realistic Return Rate

Historical average returns for a globally diversified equity portfolio have been around 7–10% per year before inflation. After inflation (typically 2–3%), real returns are closer to 5–7%. Bonds and cash savings offer lower but more stable returns. Always model a range of scenarios — optimistic, base case, and pessimistic — rather than relying on a single figure.

Regular Contributions vs. Lump Sum

Regular monthly contributions (cost averaging) can reduce the risk of investing a large sum at the wrong time and help build disciplined saving habits. This calculator supports both lump-sum and recurring contribution scenarios so you can compare strategies and make more informed decisions about your financial future.

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Important Note: This tool is intended to provide estimates and should not be used as a substitute for professional advice. Information generated by these calculators may be incomplete and does not account for all individual circumstances. Always seek the counsel of a certified expert (such as a financial advisor, healthcare provider, or licensed engineer) before taking action based on these results.

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