Quick Answer
Investing $500 per month at a 7% average annual return (the inflation-adjusted historical average of the S&P 500) grows to approximately $86,500 in 10 years, $260,500 in 20 years, and $610,000 in 30 years. At 30 years, you will have contributed $180,000 of your own money -- the remaining $430,000 is compound growth. Compounding did nearly two and a half times the work you did.
Investing a lump sum instead? $10,000 left alone at 7% becomes approximately $20,097 in 10 years, $40,387 in 20 years, and $81,165 in 30 years. At that rate any balance doubles roughly every 9.9 years. Jump to the lump-sum lookup table to find your own starting amount.
The same $500/month in a high-yield savings account at 4.5% APY would grow to approximately $75,600 in 10 years and $379,700 in 30 years -- about 62% of the invested result over three decades.
Important: Investment returns are not guaranteed. The 7% figure is a long-term historical average, not a promise. In the eleven calendar years from 2015 through 2025, only one S&P 500 annual return landed within five points of 7% -- see what the average actually looked like.
Key Takeaways
- $500/month at 7% grows to approximately $610,000 in 30 years -- but you only contributed $180,000. Compound growth contributed $430,000, nearly two and a half times your own money
- Time is the most powerful variable: the same $500/month produces $86,500 in 10 years but $610,000 in 30 years -- a 7.0x increase for 3x the time
- Starting 10 years earlier beats doubling your contribution. $500/month for 30 years ($610,000) outperforms $1,000/month for 20 years ($520,900)
- Investing vs. saving compounds over time. At 30 years, investing at 7% produces roughly 1.6x the value of a high-yield savings account at 4.5%
- Fees erode wealth: a 1% annual fee on a $500/month portfolio reduces the 30-year total by approximately $107,700 -- choose low-cost index funds
Investment Growth Projections by Monthly Contribution
The table below shows how different monthly investment amounts grow over 10, 20, and 30 years at a 7% average annual return, compounded monthly -- the same convention our Investment Calculator uses, so the figures below reproduce exactly if you model them there. These projections assume consistent monthly contributions made at the end of each month, with no initial lump sum.
| Monthly Investment | 10 Years | 20 Years | 30 Years | Total Contributed | Growth at 30 Years |
|---|---|---|---|---|---|
| $100/mo | $17,300 | $52,100 | $122,000 | $36,000 | $86,000 (239%) |
| $200/mo | $34,600 | $104,200 | $244,000 | $72,000 | $172,000 (239%) |
| $300/mo | $51,900 | $156,300 | $366,000 | $108,000 | $258,000 (239%) |
| $500/mo | $86,500 | $260,500 | $610,000 | $180,000 | $430,000 (239%) |
| $750/mo | $129,800 | $390,700 | $915,000 | $270,000 | $645,000 (239%) |
| $1,000/mo | $173,100 | $520,900 | $1,220,000 | $360,000 | $860,000 (239%) |
Note: Figures are projections computed as FV = PMT x ((1+i)^n - 1)/i with i = 0.07/12 and n = months -- a 7% annual return compounded monthly, rounded to the nearest $100. Actual results vary based on market performance, fees, and timing of contributions. Figures do not account for taxes on gains.
Key Insight
The growth-to-contribution ratio is consistent (239% at 30 years) regardless of monthly amount, which is why every row of the table above shows the same percentage. Compound growth scales linearly with contributions. The variable that changes the ratio is time, not amount.
Why Time Matters More Than Amount
Starting early with a smaller amount typically outperforms starting later with a larger contribution. The following comparison illustrates this principle.
| Scenario | Monthly | Start Age | Years Investing | Total Contributed | Projected Value (7%) |
|---|---|---|---|---|---|
| Early start | $300/mo | 25 | 40 | $144,000 | $787,000 |
| Late start, 2x | $600/mo | 35 | 30 | $216,000 | $732,000 |
| Very late, 3x | $900/mo | 45 | 20 | $216,000 | $469,000 |
The 25-year-old contributing $300/month outperforms the 35-year-old contributing $600/month -- despite investing $72,000 less of their own money. This is the most compelling argument for starting early, even with small amounts.
The Rule of 72 estimates how long it takes an investment to double: divide 72 by your annual return rate. At a 4% return, money doubles in 18 years; at 6%, 12 years; at 8%, 9 years; and at 10%, about 7.2 years. At a 7% return, $10,000 becomes $20,000 in about 10.3 years -- and $40,000 in about 20.6 years. Shorter bar, faster doubling.
Enter Your Monthly Investment to See Personalized Projections →
What Will a Lump Sum Be Worth in 10, 20, or 30 Years?
The tables above assume you add money every month. If instead you have a single amount already invested -- an old 401(k), an inheritance, a bonus, the proceeds of a house sale -- and you plan to leave it alone, the arithmetic is simpler: the balance multiplies by itself over and over.
Find your starting amount in the left column and read across to your time horizon. Every figure assumes a 7% average annual return compounded monthly and no further contributions.
| Starting Amount | 5 Years | 10 Years | 15 Years | 20 Years | 25 Years | 30 Years |
|---|---|---|---|---|---|---|
| $1,000 | $1,418 | $2,010 | $2,849 | $4,039 | $5,725 | $8,116 |
| $5,000 | $7,088 | $10,048 | $14,245 | $20,194 | $28,627 | $40,582 |
| $10,000 | $14,176 | $20,097 | $28,489 | $40,387 | $57,254 | $81,165 |
| $25,000 | $35,441 | $50,242 | $71,224 | $100,968 | $143,135 | $202,912 |
| $50,000 | $70,881 | $100,483 | $142,447 | $201,937 | $286,271 | $405,825 |
| $100,000 | $141,763 | $200,966 | $284,895 | $403,874 | $572,542 | $811,650 |
Note: computed as FV = PV x (1 + i)^n with i = 0.07/12 and n = months -- the same monthly-compounding convention our Investment Calculator uses, so entering any row above as an initial investment with a $0 monthly contribution reproduces the figure exactly. Values are rounded to the nearest dollar and do not account for taxes or fees.
The table scales cleanly: because every row uses the same multiplier, $50,000 always lands at exactly five times the $10,000 row. If your starting balance is not listed, multiply the $10,000 row by your amount divided by 10,000. A $17,500 rollover after 20 years, for example, is $40,387 x 1.75 = about $70,700.
Lump sum vs. monthly contributions
A one-time $10,000 becomes about $81,165 over 30 years. Contributing $100 every month over the same 30 years -- $36,000 of your own money -- reaches about $122,000. The lump sum is doing more work per dollar because every dollar of it compounds for the full 30 years, while the last monthly contribution compounds for one month. If you have both, the calculator handles them together.
The Same $10,000 at Different Return Rates
The assumed rate matters more than most people expect over long horizons. The table below holds the starting amount at $10,000 and varies only the return.
| Annual Return | 5 Years | 10 Years | 15 Years | 20 Years | 25 Years | 30 Years |
|---|---|---|---|---|---|---|
| 4% (conservative bond-heavy) | $12,210 | $14,908 | $18,203 | $22,226 | $27,138 | $33,135 |
| 5% | $12,834 | $16,470 | $21,137 | $27,126 | $34,813 | $44,677 |
| 6% | $13,489 | $18,194 | $24,541 | $33,102 | $44,650 | $60,226 |
| 7% (inflation-adjusted stock average) | $14,176 | $20,097 | $28,489 | $40,387 | $57,254 | $81,165 |
| 8% | $14,898 | $22,196 | $33,069 | $49,268 | $73,402 | $109,357 |
| 9% | $15,657 | $24,514 | $38,380 | $60,092 | $94,084 | $147,306 |
| 10% (nominal stock average) | $16,453 | $27,070 | $44,539 | $73,281 | $120,569 | $198,374 |
Over five years, the gap between a 4% and a 10% assumption is about $4,200. Over thirty years it is roughly $165,000 on the same $10,000. This is why the rate you assume in a projection deserves as much scrutiny as the amount you invest -- and why an assumption above 10% should be treated with real suspicion.
How Long Does It Take to Double Your Money?
Doubling time is the single most portable fact in investing: it does not depend on how much you have, only on the rate. The widely quoted Rule of 72 -- divide 72 by your return rate -- is a mental shortcut, and it is close but not exact. The table below shows both the shortcut and the arithmetic answer under monthly compounding.
| Annual Return | Exact (Monthly Compounding) | Rule of 72 Estimate | Shortcut Error |
|---|---|---|---|
| 4% | 17.4 years | 18.0 years | +0.6 years |
| 5% | 13.9 years | 14.4 years | +0.5 years |
| 6% | 11.6 years | 12.0 years | +0.4 years |
| 7% | 9.9 years | 10.3 years | +0.4 years |
| 8% | 8.7 years | 9.0 years | +0.3 years |
| 9% | 7.7 years | 8.0 years | +0.3 years |
| 10% | 7.0 years | 7.2 years | +0.2 years |
| 12% | 5.8 years | 6.0 years | +0.2 years |
Note: exact figures are ln(2) / ln(1 + i) months with i = rate/12, converted to years. The Rule of 72 slightly overstates doubling time at every rate in this table because it is calibrated for annual, not monthly, compounding.
At 7%, a balance doubles roughly every ten years. That is the whole story behind the 30-year tables above: $10,000 becomes about $20,000, then about $40,000, then about $80,000. Three doublings, three decades.
How Long Until You Reach $1,000,000?
If you already have a balance invested, the table below shows how many years it takes to cross $1,000,000 at a 7% average annual return -- first if you never add another dollar, then if you keep contributing.
| Current Balance | Adding $0/mo | Adding $500/mo | Adding $1,000/mo |
|---|---|---|---|
| $10,000 | 66.0 years | 34.8 years | 26.8 years |
| $25,000 | 52.9 years | 32.8 years | 25.7 years |
| $50,000 | 43.0 years | 29.8 years | 23.9 years |
| $100,000 | 33.0 years | 25.3 years | 21.0 years |
| $250,000 | 19.9 years | 16.8 years | 14.7 years |
| $500,000 | 10.0 years | 8.9 years | 8.0 years |
Where contributions matter most
Notice where the columns separate. Starting from $10,000, adding $500/month cuts the wait from 66 years to about 35 -- contributions are doing almost all of the work. Starting from $500,000, the same $500/month saves barely a year, because the existing balance already generates about $35,000 in growth annually at 7%. Early on you build the balance; later the balance builds itself.
What Rate of Return Should You Expect?
Choosing a realistic rate of return is essential for meaningful projections. Returns vary significantly by asset class, and the difference between nominal and inflation-adjusted (real) returns matters for long-term planning.
Historical Market Returns by Asset Class
The following benchmarks are based on long-term historical data. For a deeper analysis, see our Average ROI by Investment Type guide.
| Asset Class | Avg. Annual Return (Nominal) | Avg. Annual Return (Real) | Risk Level |
|---|---|---|---|
| S&P 500 (large-cap stocks) | 10-11% | 7-8% | Moderate-High |
| Total U.S. stock market | 10-11% | 7-8% | Moderate-High |
| International stocks | 8-9% | 5-6% | Moderate-High |
| U.S. bonds (aggregate) | 5-6% | 2-3% | Low-Moderate |
| REITs | 9-10% | 6-7% | Moderate-High |
| High-yield savings | 4-5% (current) | 1-2% | Very Low |
| Balanced portfolio (60/40) | 8-9% | 5-6% | Moderate |
Source: S&P 500 returns based on long-term historical averages (1926-2025). Past performance does not guarantee future results.
Conservative, Moderate, and Aggressive Scenarios
The following table shows how $500/month grows over 30 years at different return assumptions.
| Scenario | Assumed Return | 30-Year Value | Growth Above Contributions |
|---|---|---|---|
| Conservative (bonds/balanced) | 5% | $416,000 | $236,000 |
| Moderate (balanced) | 7% | $610,000 | $430,000 |
| Aggressive (all-equity) | 9% | $915,000 | $735,000 |
Each 2% increase in return rate adds approximately $150,000-$200,000 over 30 years on a $500/month portfolio. Risk tolerance, time horizon, and financial goals should drive asset allocation -- not return chasing. Consult a qualified financial professional to determine the appropriate allocation for your situation.
What an “Average” Return Actually Looked Like: 2015-2025
Every table on this page uses a smooth annual rate, because that is the only way to project forward. Markets do not cooperate. The table below shows the actual calendar-year return of the S&P 500 including reinvested dividends for the eleven years from 2015 through 2025, alongside what a single $10,000 invested at the start of 2015 would have been worth at the end of each year.
The comparison column holds a steady 10% -- the long-run nominal average of this same index -- so both columns are measured the same way, before inflation.
| Year | S&P 500 Total Return | Value of $10,000 (Actual) | Value at a Steady 10% |
|---|---|---|---|
| 2015 | +1.38% | $10,138 | $11,000 |
| 2016 | +11.77% | $11,331 | $12,100 |
| 2017 | +21.61% | $13,780 | $13,310 |
| 2018 | -4.23% | $13,197 | $14,641 |
| 2019 | +31.21% | $17,316 | $16,105 |
| 2020 | +18.02% | $20,436 | $17,716 |
| 2021 | +28.47% | $26,254 | $19,487 |
| 2022 | -18.04% | $21,518 | $21,436 |
| 2023 | +26.06% | $27,126 | $23,579 |
| 2024 | +24.88% | $33,874 | $25,937 |
| 2025 | +17.78% | $39,897 | $28,531 |
Source: annual returns on the S&P 500 including dividends, from the NYU Stern historical returns dataset maintained by Aswath Damodaran(opens in new tab). The $10,000 columns are our own arithmetic applied to that published series; they assume a single lump sum, no fees, no taxes, and no additional contributions.
Three things this table is telling you
- The average year is a fiction. Of these eleven years, only one -- 2016, at 11.77% -- came within five percentage points of 7%. Two years were negative. Five finished above 20%. No year was “average.”
- Getting to a good result does not feel like progress along the way. The actual balance finished 2015, 2016 and 2018 behind the steady-10% line, edged ahead in 2017, and only stayed ahead from 2019 onward. Anyone who judged the strategy at the end of 2018 -- down 4.23% on the year and $1,444 behind a plain 10% assumption -- would have concluded it was not working.
- This stretch was unusually good. Compounded across 2015-2025 the actual series works out to about 13.4% a year; across 2016-2025 alone, about 14.7%. The same dataset's full 1928-2025 record compounds to roughly 10.0% a year. Planning on the last decade repeating is the most common way these projections go wrong.
This is the argument for the conservative end of the range. If you model at 7% and the market delivers something closer to its long-run 10%, you are pleasantly ahead of plan. If you model at 12% because that is what recent years produced and the next decade looks like the 2000s, you have built a retirement plan on a number that has to be rebuilt from scratch. Run your projection twice -- once at 5%, once at 7% -- and treat the low case as the one you have to be able to live with.
Investing vs. Saving: The Long-Term Difference
For short time horizons, the difference between investing and keeping money in a high-yield savings account is modest. Over decades, however, the gap becomes substantial.
| Time Horizon | HYSA at 4.5% | Invested at 7% | Difference | Investing Advantage |
|---|---|---|---|---|
| 5 years | $33,600 | $35,800 | $2,200 | 7% |
| 10 years | $75,600 | $86,500 | $10,900 | 14% |
| 20 years | $194,100 | $260,500 | $66,400 | 34% |
| 30 years | $379,700 | $610,000 | $230,300 | 61% |
At 5 years, the difference is marginal ($2,200). At 30 years, investing produces $230,300 more. The advantage of investing over saving compounds over time -- which is precisely why a longer time horizon favors investment accounts.
When Savings May Be the Better Choice
Short time horizons (under 5 years), known near-term expenses like a down payment, and your emergency fund should generally stay in a high-yield savings account. Investments carry short-term volatility risk that savings accounts do not.
For a detailed look at how to prioritize saving vs. investing, see our Emergency Fund vs Paying Off Debt guide for a prioritization framework.
How Much to Invest Monthly to Reach Your Goal
If you have a specific wealth target in mind, the table below shows the monthly contribution required at a 7% average annual return. These figures assume no initial investment and consistent monthly contributions.
| Goal Amount | 10-Year Contribution | 20-Year Contribution | 30-Year Contribution |
|---|---|---|---|
| $100,000 | $578/mo | $192/mo | $82/mo |
| $250,000 | $1,444/mo | $480/mo | $205/mo |
| $500,000 | $2,889/mo | $960/mo | $410/mo |
| $1,000,000 | $5,778/mo | $1,920/mo | $820/mo |
The millionaire math: $820/month invested consistently for 30 years at a 7% average return reaches $1,000,000. Your total out-of-pocket contributions would be $295,200. Compound growth contributes the remaining $705,000. Use our 401(k) Retirement Calculator to see how employer matching accelerates your path to this goal.
For most people, this target is achievable when combining 401(k) contributions with employer match and IRA or taxable account contributions. In 2026, you can contribute up to $24,500 to a 401(k) and $7,500 to an IRA -- a combined $32,000 per year, or approximately $2,667/month in tax-advantaged accounts alone.
The Impact of Investment Fees
Investment fees are often overlooked, but they compound against you just as powerfully as returns compound for you. Even seemingly small percentage differences can cost tens of thousands of dollars over a long time horizon.
How Fees Erode Returns
The following table shows the impact of annual fees on a $500/month portfolio over 30 years at a 7% gross return.
| Annual Fee | Net Return | 30-Year Value | Fee Cost (vs. No-Fee) |
|---|---|---|---|
| 0.03% (low-cost index fund) | 6.97% | $606,400 | $3,600 |
| 0.50% (average ETF) | 6.50% | $553,100 | $56,900 |
| 1.00% (managed fund) | 6.00% | $502,300 | $107,700 |
| 1.50% (high-fee fund) | 5.50% | $456,800 | $153,200 |
| 2.00% (advisor + fund fees) | 5.00% | $416,100 | $193,900 |
Fee Impact
A 1% annual fee reduces a 30-year portfolio by approximately $107,700 (from $610,000 at 7.00% to $502,300 at 6.00%). That money goes to the fund manager instead of your future. This is why index fund investing has become mainstream: the fee savings compound just as dramatically as the returns themselves.
Choosing Low-Cost Investments
Understanding the general fee landscape helps you evaluate your options:
- Total stock market index funds: Typically charge 0.03-0.10% annually
- Target-date retirement funds: Typically charge 0.10-0.20% annually
- Actively managed funds: Typically charge 0.50-1.50% annually
- Financial advisor fees: Typically add 0.50-1.00% on top of fund fees
When evaluating investment options, compare the expense ratio -- the annual percentage deducted from your returns. Even a 0.25% difference compounds into thousands of dollars over decades.
Lump Sum vs. Dollar-Cost Averaging (DCA)
If you have a large amount to invest -- from an inheritance, bonus, or tax refund -- you face a common question: invest it all at once (lump sum) or spread it out over time (dollar-cost averaging)?
- Lump sum investing: Deploying the full amount immediately (e.g., investing $60,000 today)
- Dollar-cost averaging (DCA): Investing a fixed amount on a regular schedule (e.g., $5,000/month for 12 months)
Historical data shows lump sum investing outperforms DCA approximately two-thirds of the time, because markets tend to rise over time. The longer your money is in the market, the more time it has to compound.
However, DCA offers important behavioral benefits:
- Reduces timing risk by spreading purchases across different market conditions
- Removes emotion from investment decisions
- Automates the investing habit
For most people receiving a regular paycheck, DCA through automatic monthly contributions is the natural and practical approach. For windfalls, the data favors investing immediately, but splitting the amount into 3-6 monthly installments is a reasonable compromise if investing the full amount at once causes anxiety.
Most Investors Already Use DCA
If you contribute to a 401(k) through payroll deduction or set up automatic monthly transfers to an investment account, you are already dollar-cost averaging. This approach has the added benefit of making investing a consistent habit rather than a one-time decision.
Learn more about how compounding mechanics drive these outcomes in our Compound Interest Calculator Guide, and see Monthly Compound Interest Explained for a deeper look at compounding frequency.
Start Growing Your Wealth Today
The data consistently shows that building wealth through investing comes down to three factors you can control:
- Start now -- every year of delay reduces your compounding window. Even $100/month grows to about $122,000 over 30 years at 7%
- Contribute consistently -- automatic monthly contributions remove emotion and build the investing habit
- Keep fees low -- choose low-cost index funds to keep more of your returns compounding for you
The projections in this guide use historical average returns for illustrative purposes. Your actual results will depend on market conditions, asset allocation, fees, taxes, and individual circumstances. Consider consulting a qualified financial professional to develop an investment plan tailored to your goals and risk tolerance.
Compare your savings progress against national benchmarks with our Average Savings by Age data, check whether you are on track for retirement with 401(k) by Age benchmarks, or explore your overall financial picture with our Net Worth by Age guide.
See How Your Investments Will Grow
Enter your initial investment, monthly contribution, and expected return rate to project your compound growth over any time period.
Sources
- NYU Stern (Aswath Damodaran) -- Historical Returns on Stocks, Bonds, and Bills(opens in new tab)
- S&P Dow Jones Indices -- S&P 500 Index Data(opens in new tab)
- SEC Investor.gov -- Compound Interest Calculator(opens in new tab)
- IRS -- 401(k) Contribution Limits (2026)(opens in new tab)
- IRS -- IRA Contribution Limits (2026)(opens in new tab)
- Federal Reserve -- Selected Interest Rates (H.15)(opens in new tab)
Important Disclaimer
Disclaimer: This content is for educational and informational purposes only and does not constitute financial, tax, or legal advice. Investment returns are not guaranteed. Past performance does not predict future results. The projections in this guide use historical average returns for illustrative purposes only. Actual investment results will vary based on market conditions, asset allocation, fees, taxes, and individual circumstances. Projections do not account for taxes on capital gains or dividends, which reduce after-tax returns. Do not make investment decisions based solely on this guide. Consult with a qualified financial professional before making investment decisions. While we strive for accuracy, laws and regulations change frequently. Data current as of August 2026.
Content reviewed by Mark at Markco Labs. Learn more about our accuracy standards.
Frequently Asked Questions
At a 7% average annual return, $500/month invested for 20 years grows to approximately $260,500. You would have contributed $120,000 of your own money; the remaining $140,500 is compound growth. At a more conservative 5% return, the total would be approximately $205,500. Use our Investment Calculator to model your specific scenario.
A $10,000 lump sum with no further contributions grows to approximately $40,387 in 20 years at a 7% average annual return compounded monthly. Over 10 years it reaches about $20,097, and over 30 years about $81,165. Lower the assumed return to 5% and the 20-year figure falls to roughly $27,126; raise it to 9% and it rises to roughly $60,092. The full lump-sum lookup table covers starting amounts from $1,000 to $100,000.
At a 7% annual return compounded monthly, money doubles in approximately 9.9 years. The Rule of 72 shortcut (72 divided by 7) estimates 10.3 years, so it overstates the true doubling time slightly at this rate. At 5% the exact doubling time is about 13.9 years, at 9% about 7.7 years, and at 10% about 7.0 years. Doubling time depends only on the rate, not on how much you have.
No. Across the eleven calendar years from 2015 through 2025, only one annual S&P 500 return landed within five percentage points of 7%, according to the NYU Stern historical returns dataset. Two of those years were negative and five exceeded 20%. The 7% figure used in planning is a long-term inflation-adjusted average, not a description of any individual year -- see the year-by-year table.
At a 7% average annual return, you would need to invest approximately $820/month for 30 years to reach $1 million. Your total out-of-pocket contributions would be approximately $295,200. Compound growth would contribute the remaining $705,000. Combining 401(k) contributions with employer match and IRA contributions can make this target achievable.
A diversified stock portfolio has historically returned approximately 10-11% annually before inflation, or 7-8% after inflation. A balanced portfolio (60% stocks, 40% bonds) has historically returned approximately 8-9% before inflation. Conservative investors should model 5-6% annual returns. These are long-term averages; any single year can vary significantly. See our ROI Benchmarks by Investment Type for detailed analysis.
It depends on your debt interest rate. If your debt APR exceeds 7-8%, paying it off provides a guaranteed "return" that likely exceeds investment returns. If your debt rate is below 5%, investing may produce higher long-term returns. See our Emergency Fund vs Paying Off Debt guide for a detailed framework. Consult a qualified financial professional for personalized guidance.
A 1% annual fee on a $500/month portfolio reduces the 30-year total by approximately $107,700. A 2% fee costs approximately $193,900 over the same period. Low-cost index funds charging 0.03-0.10% minimize this drag on returns. The fee table in our fee impact section above shows the full breakdown.
Historical data shows lump sum investing outperforms dollar-cost averaging about two-thirds of the time. However, DCA (investing a fixed amount monthly) is the practical approach for most people investing from regular income. If you receive a windfall, splitting it into 3-6 monthly installments is a reasonable compromise if investing the full amount at once feels uncomfortable.
Inflation reduces the real purchasing power of your returns. A 10% nominal return in a year with 3% inflation provides only 7% real growth. Use the inflation-adjusted return (typically 7% for stocks) when projecting long-term purchasing power. Our Inflation Impact Guide covers how inflation affects your savings and investments in detail.
As early as possible. A 25-year-old investing $300/month at 7% accumulates approximately $787,000 by age 65. A 35-year-old contributing $600/month from age 35 still finishes lower, at about $732,000, despite putting in $72,000 more out of pocket. Even $50-$100/month in your early 20s establishes the habit and gives compound growth the maximum time horizon. See How Much to Save Each Month for income-based contribution guidelines.