How the millionaire math works
Reaching a million comes down to three numbers: what you already have, what you add each month, and the return your money earns. The calculator adds your deposit at the end of each month and lets the whole balance grow by one twelfth of your yearly return, month after month, until it crosses your target. That repeated growth on top of earlier growth is compounding, and it is why the last stretch of the climb goes so much faster than the first.
Balance next month = balance this month × (1 + yearly return ÷ 12) + monthly deposit
With $25,000 saved, $800 a month and a 7% return, it takes about 27 years and 11 months. In that time you deposit roughly $268,000 of your own money, and returns supply the remaining $700,000 or so. Look at the milestone bars and you will see the pattern: the first $100,000 takes more than five years, while the jump from $750,000 to $1,000,000 takes about three and a half.
Which return should you enter?
The return is the number people argue about most, and it moves the answer more than anything else. Broad stock market index funds have historically averaged something like 10% a year before inflation over very long periods, which is roughly 7% after inflation, but individual decades have been far better and far worse. A savings account or CD might pay 3% to 5% depending on rates at the time.
If you enter a real return (after inflation), the answer is in today's money, so "a million" means a million in today's buying power. If you enter a nominal return like 10%, you reach a million sooner, but that future million will buy less than it does today. Many planners use 6% to 7% as a cautious long-run figure for a stock-heavy portfolio, and it is worth trying a lower number such as 5% to see how sensitive your plan is.
Ways to get there sooner
Because contributions drive the early years, the most reliable lever is the monthly amount. The second tab shows what happens if you raise your saving by a few percent every year, the way a pay rise or a standing promise to yourself might. Even a 3% yearly increase usually trims several years off the timeline, without asking you to find a big sum on day one.
Starting earlier matters as well, since every extra year gives compounding more time to work, and keeping investment fees low protects the return you entered. Moving from a 1% fund fee to a 0.1% one is, in effect, almost a full percentage point of extra return every year.
Common questions
How long does it take to save $1 million?
Starting from zero at a 7% yearly return, saving $500 a month takes about 36 years, $1,000 a month about 27.5 years, and $2,000 a month about 19.5 years. Starting with savings already in place shortens every one of those.
How much do I need to save a month to be a millionaire in 20 years?
From zero, at 7% a year, you need roughly $1,920 a month to reach $1 million in 20 years. Use the millionaire by age calculator to solve for the monthly amount directly.
Is a 7% return realistic?
It is a common long-run planning figure for a diversified stock portfolio after inflation, but nothing is guaranteed and some decades deliver much less. Try 5% for a cautious plan.
Does this include taxes?
No. Money in tax-advantaged accounts such as a 401(k), IRA or ISA grows without yearly tax, while a taxable account loses some growth to tax. Enter a slightly lower return to allow for that.
This calculator gives estimates for planning. Real returns, rates and prices change, so treat the result as a guide rather than a promise. Read how we build and check our calculators.