Free tools to help you plan your investments. Calculate compound growth, compare strategies, and test your investment knowledge.
Compound interest is when you earn interest on both your original investment AND previously earned interest. It's the foundation of wealth building through investing. The formula: A = P(1 + r/n)^(nt)
DCA involves investing a fixed amount regularly regardless of market conditions. This strategy reduces the impact of volatility and removes the pressure of timing the market perfectly.
The most powerful variable in investing is time. Starting early—even with small amounts—dramatically increases your final wealth due to compound growth over decades.
Historical average annual returns to help with your calculations:
| Asset Class | Historical Average | Risk Level |
|---|---|---|
| S&P 500 Index | ~10% per year | Moderate-High |
| Total Stock Market | ~9-10% per year | Moderate-High |
| International Stocks | ~7-8% per year | High |
| Bonds (Aggregate) | ~5-6% per year | Low-Moderate |
| Real Estate (REITs) | ~9-10% per year | Moderate |
| High-Yield Savings | ~4-5% per year | Very Low |
Note: Past performance doesn't guarantee future results. These are long-term historical averages.