Mutual Fund Calculator – Estimate Your Mutual Fund Returns

This mutual fund investment calculator will help you calculate the future value of your mutual funds based on an estimated, average rate of return.  The calculator will take into account regular deposits along with any associated mutual fund fees.

Current Balance: $
Annual Addition: $
Years to grow:  
Average Return:   %
Expense Ratio:   %
Compound interest time(s) annually
Add Money At The start end of each compounding period
 
Future Value: $

How The Mutual Fund Calculator Works

Our calculator implements the basic compound interest calculator formula and then deducts the expense ratio at the end of each year for the calculation period selected.  We also base the calculator on an average rate of return which will provide an estimate, but not 100% accurate values due to market fluctuations.

Multiple Uses Of This Calculator

This investment calculator can also be utilized for other various stock market-based return calculations such as:

  • mutual fund growth calculations
  • calculating investment returns
  • calculating mutual fund returns
  • 401k calculator
  • retirement calculator
  • mutual fund calculator with yearly contribution

What This Investment Calculator Does Not Do

This mutual fund calculator does not take into account any front loaded fees or back-loaded fees.  If you have invested in a mutual fund with these types of fees you would need to subtract the percentage charged from the values to come up with a more accurate rate of return on your investment.

A Brief Explanation of Stocks vs Mutual Funds

A stock is a one-off situation where you select a company and purchase shares in the company.  The two scenarios are really the price can go up, or the price can go down.

A mutual fund is a collection of stocks in which you buy a portion  of the entire asset portfolio.  This means your risk is not solely tied to a single company, but quite possibly spread over 100 or 1000 companies.

With mutual funds your potential for growth is not as high as purchasing an individual stock, but your potential for loss is also substantially lower.

If you were to buy single stock in a company that goes bankrupt, you can stand to lose everything.  If you don’t think this can happen, you’re wrong 🙂

You only need to look back a few years at companies like Enron or Lehman Brothers to see that what look like financially healthy companies could go under at a moment’s notice.

Mutual funds have built-in protection to this type of loss due to diversification across the multiple companies in which they invest.

 How Does A Mutual Fund Work?

Investors like you and me pool our money to buy a mutual fund.  An asset management company has professionals in place to manage the fund and determine which companies stocks are purchased with everyone’s money.

Mutual funds are typically well diversified (although there are some very specific mutual funds these days).

What happens after you invest in mutual funds?  Once your money is invested, you are given “units” which are easily redeemable to back your money.

What is a mutual fund NAV (Net Asset Value)?

The nav of a mutual fund represents the price of a single unit after fees.

Steps To Begin Investing in Mutual Funds

When beginning your mutual fund investment journey you need to determine your time horizon and how long you wish to invest in mutual funds.

You then need to determine how much money you want to invest and how much money you will need for retirement.  Use the mutual fund calculator above to get an estimate for these numbers.

Based on your time horizon and risk tolerance, you can choose your funds in which you want to invest.  We like Vanguard Index Funds.

Next you can make your initial investment online with an online broker or through the mutual fund company.