Understanding the future value calculator
Future value runs compounding forward: it tells you what today's money, plus any regular additions, becomes after a set number of years at a given rate. It is the mirror image of present value the same equation solved in the other direction and the basis of every retirement and savings projection.
The formula's inputs deserve more skepticism than its output. A one-point difference in assumed return compounds into a huge difference over decades, and inflation quietly erodes what the final number will buy. Running the calculation with a real (inflation-adjusted) rate of return gives an answer in today's purchasing power, which is usually the more useful figure.
Results are estimates for education only and are not financial advice.