The CoastFi Calculator is a powerful tool designed to estimate the future value of your investments, considering an initial lump sum, regular monthly contributions, an expected annual growth rate, and the investment duration. This calculator is particularly useful for financial planning, retirement projections, and understanding the potential impact of compounding returns over time.
How it Works (The Math Behind CoastFi)
This calculator uses the future value formula for an ordinary annuity, combined with the future value of a lump sum, to provide a comprehensive projection. The formula considers:
Initial Investment (P): The principal amount you start with.
Monthly Contributions (PMT): The amount you add to your investment each month.
Annual Growth Rate (r): The expected rate of return on your investment per year, expressed as a decimal (e.g., 8% becomes 0.08).
Investment Duration (t): The total number of years you plan to invest.
The calculation involves two main parts:
Future Value of the Initial Investment: Calculated using the compound interest formula: $FV_{lump} = P(1 + r)^t$
Future Value of Monthly Contributions (Annuity): Calculated using the future value of an ordinary annuity formula: $FV_{annuity} = PMT \times \frac{((1 + i)^n – 1)}{i}$
Where 'i' is the periodic interest rate (annual rate / 12).
And 'n' is the total number of periods (years * 12).
The total CoastFi value is the sum of these two components: Total FV = $FV_{lump} + FV_{annuity}$.
Key Inputs Explained:
Initial Investment: The single sum of money you deposit at the beginning of your investment period.
Monthly Contributions: The consistent amount you plan to add to your investment every month. Regular contributions are crucial for long-term wealth building.
Expected Annual Growth Rate (%): This is your projected average annual return. It's important to be realistic; past performance is not indicative of future results. Consider diversifying your investments to achieve this rate.
Investment Duration (Years): The length of time you intend to keep your money invested. Compounding works best over longer periods.
Use Cases:
Retirement Planning: Estimate how much you might have saved by retirement based on current savings habits and projected growth.
Long-Term Goal Setting: Project the future value of investments for goals like a down payment on a house, your child's education, or financial independence.
Investment Strategy Evaluation: Compare the potential outcomes of different investment scenarios by adjusting the growth rate, contribution amounts, and time horizon.
Disclaimer: This calculator provides an estimation based on the inputs provided and assumes a consistent growth rate. Actual investment returns can vary significantly due to market fluctuations, fees, and other factors. It is recommended to consult with a qualified financial advisor for personalized financial advice.
function calculateCoastFi() {
var initialInvestment = parseFloat(document.getElementById("initialInvestment").value);
var monthlyContributions = parseFloat(document.getElementById("monthlyContributions").value);
var annualGrowthRate = parseFloat(document.getElementById("annualGrowthRate").value);
var investmentYears = parseFloat(document.getElementById("investmentYears").value);
var resultDiv = document.getElementById("result");
var resultValueSpan = document.getElementById("result-value");
var resultUnitSpan = document.getElementById("result-unit");
// Input validation
if (isNaN(initialInvestment) || initialInvestment < 0 ||
isNaN(monthlyContributions) || monthlyContributions < 0 ||
isNaN(annualGrowthRate) || annualGrowthRate < 0 ||
isNaN(investmentYears) || investmentYears 0) {
fvAnnuity = monthlyContributions * ( (Math.pow((1 + monthlyRate), numberOfMonths) – 1) / monthlyRate );
} else {
// If rate is 0, future value is just total contributions
fvAnnuity = monthlyContributions * numberOfMonths;
}
var totalFutureValue = fvLumpSum + fvAnnuity;
resultValueSpan.textContent = totalFutureValue.toLocaleString(undefined, { maximumFractionDigits: 2, minimumFractionDigits: 2 });
resultUnitSpan.textContent = "USD"; // Assuming USD as the currency
resultDiv.style.display = 'block';
}