Money
CAGR Calculator
Enter the beginning value, ending value, and number of years. The calculator returns CAGR, total return, and the growth multiple. Useful for comparing investments and business growth over different time spans.
Inputs
Fractional years are fine (e.g. 3.5).
What CAGR is (and is not)
- CAGR is the smooth annual growth rate that takes the beginning value to the ending value over the period.
- It assumes a single deposit at the start and no additions or withdrawals along the way.
- It hides volatility. An investment that doubled then halved each year can have the same CAGR as one that grew steadily.
- For series with ongoing contributions, use the future value or savings calculator instead.
Educational estimate. Not investment, financial, or tax advice. Past performance does not predict future returns.
CAGR
12.475%
5 years; $10,000.00 → $18,000.00
CAGR is useful for comparing investments and businesses over different time spans. A 100% total return over 10 years is roughly 7.18% CAGR; the same 100% return over 2 years is 41.4% CAGR.
Examples
$10,000 to $18,000 over 5 years
CAGR ≈ 12.47%; total return 80%
$25,000 to $50,000 over 7 years
CAGR ≈ 10.41%; multiple 2x
$100,000 to $200,000 over 10 years
CAGR ≈ 7.18%
$5,000 to $4,000 over 3 years
CAGR ≈ −7.17% (loss)
How it works
CAGR is the constant rate that grows the beginning value into the ending value over the period. It is the nth root of the growth multiple minus one, where n is the number of years.
CAGR · CAGR = (ending / beginning)^(1 / years) − 1
Total return = (ending − beginning) / beginning. Multiple = ending / beginning.
Related money calculators
- Compound interest calculator for projecting growth forward when you know the rate.
- Future value calculator for FV of a lump sum or a series with contributions.
- Savings calculator for planning monthly contributions to reach a savings goal.
- Roth IRA calculator for retirement-account growth projections.
- 401k calculator for retirement projections with employer match.
- All money calculators.
Frequently asked questions
CAGR (compound annual growth rate) is the constant annual growth rate that would take the beginning value to the ending value over the period, as if growth were perfectly smooth. It is the standard way to express the annualized return of an investment.
CAGR = (ending / beginning)^(1 / years) − 1. Express the result as a percentage. For example, $10,000 growing to $18,000 over 5 years gives (1.8)^(1/5) − 1 ≈ 12.47%.
Total return is the percent change between the two values: (ending − beginning) / beginning. CAGR annualizes that total return so different time horizons can be compared on the same scale.
No. CAGR assumes a single deposit at the start and no flows in or out. For series with ongoing deposits, use the future value or savings calculator. To compute a return with contributions, look up money-weighted return (IRR) or time-weighted return.
CAGR is a smoothed average. A volatile path with the same start and end as a smooth path produces the same CAGR. Two investments with identical CAGRs can have very different risk profiles. Always look at year-to-year returns or standard deviation alongside CAGR.
No. CAGR is just arithmetic on two numbers. Picking investments, planning retirement, or evaluating businesses involves many factors beyond CAGR; consult a qualified financial professional for advice.
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