Investment Return Simulator — Project Your Wealth with AI

Compound growth is reinvesting the returns so that each year's growth itself generates more growth. Mathematically: future value = principal × (1 + r)^n. The non-intuitive part is how steeply the curve bends in the later years. $10k at 7% becomes $19.7k after 10 years, $38.7k after 20 years, $76.1k after 30 years, $149.7k after 40 years. The doubling speeds up because each doubling starts from a larger base.

This is why Albert Einstein supposedly called compound interest the eighth wonder of the world. The catch: it only works if you don't interrupt it. Every withdrawal, every panicked sell, every time you cash out 'just for now' resets the curve. The Investment Return Simulator shows exactly how the compound curve unfolds for your numbers and what gets sacrificed when contributions stop or the timeline shortens.

A 25-year-old contributing $300/month at 7% real return ends up with about $720k by age 65. A 35-year-old contributing $600/month — twice as much — ends up with about $680k. Same money in, less out, because the early starter's contributions compounded for an extra decade.

The practical implication: if you're young, the most important number is not your return rate or your contribution amount — it's whether you start at all. A small automated contribution beginning at 22 dwarfs aggressive contributions starting at 32. If you're older and feeling behind, focus relentlessly on contribution amount; you can no longer buy back the time you didn't save, but you can compress the work into a higher savings rate. The simulator quantifies the cost of waiting in dollars so it stops being abstract.

Every nominal projection lies a little. $1M in 30 years sounds like financial independence — but at 3% inflation, it's only worth about $410k in today's purchasing power. A retirement budget that needs $60k/yr today will need ~$145k/yr in 30 years just to maintain the same lifestyle. Failing to factor inflation is one of the most common errors in DIY retirement planning.

The simulator shows both numbers — nominal end balance and real (inflation-adjusted) end balance — for every projection. Use the real number for planning. A 'safe' withdrawal rate (4%) on a real portfolio means real spending power, not a nominal figure that erodes. If your real projected balance is short of your real spending need, the gap is the gap — increase contributions, extend the horizon, or accept lower spending.

Average return is misleading because order matters. Two retirees who both earn an average 7% over 30 years can have wildly different outcomes — one runs out at 82, the other dies at 95 with $2M — based purely on whether the bad years cluster early or late. A 30% drawdown in year 2 of retirement is catastrophic; the same drawdown in year 25 is annoying but survivable.

The simulator stress-tests this for you. It shows what a 30% crash at year 10 vs year 25 does to the end balance, and recommends practical hedges: hold 2–3 years of spending in cash near retirement, use a dynamic withdrawal strategy (spend less in bad years), delay Social Security if possible, keep a part-time work option for early retirement. These hedges cost a small amount of upside in good scenarios in exchange for surviving the bad ones — for most people, that's the right trade.