# Rate of Return Calculator

URL: https://speedycalculator.com/calculators/finance/rate-of-return/
Last updated: 2026-10-25

> The rate of return calculator finds the annual rate of return on an investment from its initial value, final value and length – including regular deposits or withdrawals – for any compounding frequency.

## Inputs

- Initial investment
- Final amount received
- Investment length (years, months)
- Periodic deposit or withdrawal
- Cash flow frequency
- Timing
- Compounding frequency

## Results

- Rate per cash-flow period
- Effective annual rate of return
- Nominal rate (chosen compounding)
- Total deposited

## Formula

```
Solve initial × (1 + i)^N + payment × [(1 + i)^N − 1] ÷ i × (1 + i × timing) = final for i
Annual rate = nominal rate for the chosen compounding
```

## Explanation

When you add or withdraw money along the way, simply comparing start and end values gives the wrong answer. This calculator finds the money-weighted rate of return that accounts for every cash flow.

### How to use the Rate of Return Calculator

- **Initial investment**
- **Final amount received**
- **Investment length**
- **Periodic deposit or withdrawal**
- **Cash flow frequency**
- **Timing**
- **Compounding frequency**

Results update as you type, and every field accepts the units shown in its menu.

### How it works

Enter the initial investment, the final amount, the investment length, any regular deposit (negative for withdrawals) with its frequency and timing, and the compounding.

### Tips

- Use the nominal annual rate and pick the compounding frequency your bank or broker states.
- Small differences in return or fees compound into large differences over decades.
- Run the calculation with a cautious, a central and an optimistic return to see the range of outcomes.
- Past returns do not guarantee future returns – nothing here is investment advice.

### Common mistakes to avoid

- Comparing an APR with an APY or effective rate.
- Ignoring inflation, taxes and fees when judging a real return.
- Entering a percentage as a decimal (5 instead of 0.05 is correct here).

### Inputs explained

FieldWhat to enterInitial investmentAmount in your currencyFinal amount receivedAmount in your currencyInvestment lengthUnits: years, monthsPeriodic deposit or withdrawalAmount in your currencyCash flow frequencyChoose one: Monthly, Bi-weekly, Weekly, Quarterly …TimingChoose one: End of each period, Beginning of each periodCompounding frequencyChoose one: Yearly, Semi-annually, Quarterly, Monthly …

### What each result means

- **Rate per cash-flow period** = rate(round([Investment length]×[Cash flow frequency]), 0 - [Periodic deposit or withdrawal], 0 - [Initial investment], [Final amount received], [Timing])×100
- **Effective annual rate of return** = ((1 + [Rate per cash-flow period]÷100)^[Cash flow frequency] - 1)×100
- **Nominal rate (chosen compounding)** = nomr([Effective annual rate of return]÷100, [Compounding frequency])×100
- **Total deposited** = [Initial investment] + [Periodic deposit or withdrawal]×round([Investment length]×[Cash flow frequency])

### Example values

How the main result changes when **Initial investment** changes and everything else stays at the example values above:

Initial investmentEffective annual rate of return (%)5,00011.1497,5007.89910,0005.512,5003.60415,0002.0420,000-0.444

## Worked example

Inputs — Initial investment: $10,000; Final amount received: $25,000; Investment length: 10 years; Periodic deposit or withdrawal: $50; Cash flow frequency: Monthly; Timing: End of each period; Compounding frequency: Yearly.

Results — Rate per cash-flow period = 0.4472 %; **Effective annual rate of return = 5.5 %**; Nominal rate (chosen compounding) = 5.5 %; Total deposited = $16,000.00.

## FAQ

**How do I calculate rate of return with deposits?**
Solve for the rate that grows all cash flows to the final value – this calculator does it.

**What is the difference between ROR and ROI?**
ROI is a total percentage; rate of return is usually annualized.

**Can the rate be negative?**
Yes, if the final value is less than what you put in.

**What formula does the Rate of Return Calculator use?**
Solve initial × (1 + i)^N + payment × [(1 + i)^N − 1] ÷ i × (1 + i × timing) = final for i.


## Sources

- [U.S. SEC – Investor.gov compound interest and investing basics](https://www.investor.gov/)