Target Return Calculator
A Target Return Calculator estimates the monthly and annual rate of return needed to achieve a specific investment goal within a set time period. More info →
Input
Select the calculation type and enter your investment details to determine the required rate of return.
How This Calculator Works
You know how much you can invest and how much you want to end up with. This calculator finds the return you would need to earn to get there, shown both per month and per year.
The Formulas
Lumpsum: Monthly Return = (Target ÷ Lumpsum)1 / n − 1
Monthly investment: solve Target = P × [(1 + i)n − 1] ÷ i × (1 + i) for i
Monthly investment: solve Target = P × [(1 + i)n − 1] ÷ i × (1 + i) for i
n = years × 12 · Monthly investment: annual return = monthly return × 12 · Lumpsum: annual return = (1 + monthly return)12 − 1
What Each Input Does
- Calculation Type
-
Monthly Investment – you invest the same amount at the start of every month.
Lumpsum Investment – you invest one amount today. - Target Amount
- The amount you want to reach.
- Monthly / Lumpsum Investment
- What you will invest.
- Investment Duration (Years)
- How long you will stay invested.
Step by Step
- The duration is converted to months.
- Lumpsum: the monthly return comes straight from the formula. Monthly investment: the calculator tries rates until the SIP grows exactly to the target (like Excel's RATE).
- The monthly return is converted to a yearly figure as shown above.
Reading the Result
Required return – compare it with what your investments can realistically earn. If it is too high, invest more or wait longer.
Quick Example
Monthly: investing 5,000 a month for 10 years to reach 1,000,000
needs about 0.79% a month, or 9.44% a year.
Lumpsum: growing 200,000 into 500,000 in 10 years needs about 0.77% a month, or 9.60% a year.
Lumpsum: growing 200,000 into 500,000 in 10 years needs about 0.77% a month, or 9.60% a year.
Artoval Financial Labs