Frequently Asked Questions
What is compound interest?
Compound interest means you earn interest on your interest, not just your original principal. Over time, this creates exponential growth — the longer you invest, the more powerful it becomes.
How often is interest compounded in this calculator?
This calculator compounds monthly, which is standard for most savings accounts and investment accounts.
What annual return rate should I use?
The S&P 500 has historically returned around 10% annually before inflation (about 7% after inflation). High-yield savings accounts currently offer 4–5%. Use the rate that matches your investment type.
Why does starting early matter so much?
Because of compounding, money invested early has exponentially more time to grow. $1,000 invested at age 25 vs. age 35 can result in double the final balance by retirement.
How does the Worth It Score work?
The score is based on your growth multiple — how many times your total contributions you end up with. A 3x multiple or higher scores very well; under 1.5x scores lower.