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CAGR Calculator
Measure the annualized growth rate of an investment, compare two returns side by side, and project how a portfolio could grow over time.
CAGR
11.84%
Total Return
75.00%
Absolute Growth
$7,500.00
Year-by-Year Growth Projection
See how compound annual growth builds over time.
| Year | Projected Value | Growth vs. Start |
|---|---|---|
| 0 | $10,000.00 | $0.00 |
| 1 | $11,184.27 | $1,184.27 |
| 2 | $12,508.79 | $2,508.79 |
| 3 | $13,990.16 | $3,990.16 |
| 4 | $15,646.98 | $5,646.98 |
| 5 | $17,500.00 | $7,500.00 |
EveryCalc calculators are designed for fast, practical estimates with transparent inputs and no required account. We use plain formulas, visible assumptions, and related tools so visitors can check the result from more than one angle.
Results are informational only. For financial, tax, legal, medical, construction, or other high-impact decisions, verify the output against primary sources or a qualified professional.
Learn more about our review process on the EveryCalc methodology page.
Calculation notes and example
CAGR formula used here
Compound annual growth rate is CAGR = (ending value ÷ beginning value)^(1 ÷ years) - 1. It converts a total return over multiple years into a smoothed annual rate. CAGR does not mean the investment earned that exact return every year; it is the constant annual rate that would connect the starting and ending values.
Worked example
An investment grows from $40,000 to $70,000 over six years. CAGR is about 9.8% even if the actual yearly path was uneven. If another investment returned 25% in one year, total return is higher for the first investment but the annualized comparison depends on timing. Use ROI for simple profit percentage and CAGR when the holding periods differ.
Edge cases and practical tips
- CAGR ignores interim volatility, deposits, and withdrawals unless values are adjusted first.
- For cash flows during the period, an IRR-style calculation may be more appropriate.
- A high CAGR over a short period may not be repeatable over a full market cycle.
Useful companion tools: ROI Calculator, Investment Calculator, Compound Interest Calculator, and Inflation Calculator.
How to interpret the cagr result
Best use
Use the result as a planning number for comparing payments, rates, returns, tax reserves, or cash-flow choices before you request a quote or make a commitment.
Cross-check
Compare the answer with the contract, lender estimate, tax form, brokerage statement, payroll record, or invoice that will control the real-world outcome.
Watch for
Do not rely on a single optimistic rate, return, or fee assumption. Money pages work best when you run low, base, and high cases and keep professional advice separate from the estimate.
This page belongs to the Finance calculator library, so the answer should be read in the context of the decision you are modeling rather than as a universal rule.
Before relying on this cagr estimate
Most calculator mistakes come from the inputs, not the arithmetic. Use this short audit before you reuse the answer in a spreadsheet, quote, application, or important conversation.
Confirm source numbers
Match balances, rates, fees, taxes, income, and payment dates against the lender quote, payroll record, tax form, statement, invoice, or contract.
Separate cash flow from total cost
A lower monthly payment can still cost more over time if fees, interest, taxes, or a longer term are hidden in the structure.
Run conservative cases
Test at least one higher-cost or lower-return case before using the output for a purchase, refinance, investment, loan, or tax decision.
Rerun this page when the rate, price, term, fee, tax rule, income, expense, or expected holding period changes.
How to Use
- Enter your beginning value, ending value, and the number of years, or switch to start and end dates.
- Review the CAGR, total return, and absolute dollar growth instantly.
- Use Reverse CAGR mode to estimate a future ending value from a starting balance, expected CAGR, and time horizon.
- Open Compare Investments mode to evaluate two opportunities side by side.
- Check the year-by-year growth projection table to see how compounding builds over time.
Frequently Asked Questions
What is CAGR?
CAGR stands for compound annual growth rate. It shows the smoothed annual return an investment would need to grow from its starting value to its ending value over a set period.
Why use CAGR instead of total return?
Total return tells you the full percentage gain across the whole holding period, while CAGR converts that performance into an annualized rate. That makes it easier to compare investments held for different lengths of time.
Can CAGR be used for stocks, businesses, or revenue growth?
Yes. CAGR is commonly used for investment portfolios, stock performance, revenue growth, subscriber growth, and any metric that changes over multiple years where you want a normalized annual rate.
Does CAGR guarantee future returns?
No. CAGR is a backward-looking or hypothetical planning metric. Real returns can be volatile and uneven from year to year, so CAGR should be used for comparison and planning, not as a guarantee.
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