The formula
The net return after fees is (1 + nominal return) × (1 − fee) − 1. The calculator compounds the balance each period (12 a year for monthly, 52 for weekly) and adds your contribution. Dividing the final value by (1 + inflation)^years converts it into today's money — its real purchasing power. The real annual return is (1 + net return) ÷ (1 + inflation) − 1.
Using it well
Dollar-cost averaging means investing the same amount on a schedule regardless of price, so you buy more shares when prices are low. Try a 0.03% index fund against a 1% managed fund: over 30 years the gap is larger than most people expect. The nominal total looks impressive; the real value is what tells you about your future standard of living. If you have a target, compare adding years versus adding to the monthly amount.
Limitations
Returns are assumed constant; in practice, continuing to invest through downturns is what drives results. Taxes and currency are not included. Contributions to a 401(k), IRA or similar accounts can improve real outcomes through tax deferral and employer matches.
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