FXAIX (Fidelity® 500 Index Fund) Performance Estimator
Estimate your potential returns based on historical performance and projections.
Understanding the FXAIX Calculator and Fidelity® 500 Index Fund
The FXAIX Calculator is designed to help investors estimate the potential growth of their investment in the Fidelity® 500 Index Fund (FXAIX). This calculator considers your initial investment, ongoing annual contributions, the duration of your investment, and an assumed average annual rate of return.
What is FXAIX?
FXAIX is an index mutual fund that aims to track the performance of the S&P 500 Index. The S&P 500 Index comprises 500 of the largest publicly traded companies in the United States, representing a broad cross-section of the U.S. stock market. Investing in an S&P 500 index fund like FXAIX offers diversification and a way to invest in the overall growth of the U.S. economy.
How the Calculator Works (The Math Behind It)
This calculator uses a compound interest formula, adjusted to include regular contributions. The core principle is that your money grows not only from new investments but also from the earnings on your previous earnings.
The formula used is a variation of the future value of an annuity formula combined with compound growth:
Future Value (FV) = P(1+r)^n + C * [((1+r)^n – 1) / r]
Where:
P = Initial Investment
r = Annual interest rate (average annual return / 100)
n = Number of years
C = Annual Contributions
The first part, P(1+r)^n, calculates the future value of your initial lump sum investment growing over time.
The second part, C * [((1+r)^n - 1) / r], calculates the future value of your stream of annual contributions.
The calculator iterates this process year by year for accurate compounding, especially if the assumed return is not perfectly constant. However, for simplicity and common use, the direct formula provides a strong estimate. For this calculator, we'll simplify by assuming contributions are made at the end of each year for calculation purposes in the JavaScript.
Key Inputs Explained:
Initial Investment: The lump sum you invest at the beginning.
Annual Contributions: The amount you plan to add to your investment each year.
Number of Years to Invest: The total time horizon for your investment.
Assumed Average Annual Return: A projection of the yearly growth rate. Historical S&P 500 returns have averaged around 10-12% annually over long periods, but past performance is not indicative of future results. It's wise to use conservative estimates or model different scenarios.
Goal Setting: Assists in setting realistic savings targets.
Understanding Compounding: Demonstrates the power of consistent investing and compound growth.
Scenario Analysis: Allows you to test the impact of different contribution levels or return rates.
Disclaimer: This calculator provides an estimate for informational purposes only. It does not constitute financial advice. Investment returns are not guaranteed, and the value of investments can fluctuate. Consult with a qualified financial advisor before making investment decisions.
function calculateFXAIX() {
var initialInvestment = parseFloat(document.getElementById("initialInvestment").value);
var annualContributions = parseFloat(document.getElementById("annualContributions").value);
var investmentYears = parseInt(document.getElementById("investmentYears").value);
var averageAnnualReturn = parseFloat(document.getElementById("averageAnnualReturn").value);
var resultDiv = document.getElementById("result");
resultDiv.textContent = "; // Clear previous result
if (isNaN(initialInvestment) || initialInvestment < 0 ||
isNaN(annualContributions) || annualContributions < 0 ||
isNaN(investmentYears) || investmentYears <= 0 ||
isNaN(averageAnnualReturn) || averageAnnualReturn < -100) {
resultDiv.textContent = "Please enter valid positive numbers for all fields. Annual return cannot be less than -100%.";
resultDiv.style.backgroundColor = "#ffc107"; // Warning color
resultDiv.style.color = "#333";
return;
}
var rate = averageAnnualReturn / 100;
var futureValue = 0;
var currentBalance = initialInvestment;
for (var i = 0; i < investmentYears; i++) {
// Calculate growth on the current balance
currentBalance *= (1 + rate);
// Add annual contribution (assuming it's added at the end of the year for simplicity in loop)
currentBalance += annualContributions;
}
futureValue = currentBalance;
// Calculate total invested amount for comparison
var totalInvested = initialInvestment + (annualContributions * investmentYears);
var totalGains = futureValue – totalInvested;
// Format the output
var formattedFutureValue = futureValue.toLocaleString(undefined, { style: 'currency', currency: 'USD' });
var formattedTotalInvested = totalInvested.toLocaleString(undefined, { style: 'currency', currency: 'USD' });
var formattedTotalGains = totalGains.toLocaleString(undefined, { style: 'currency', currency: 'USD' });
resultDiv.textContent = "Estimated Future Value: " + formattedFutureValue + " (Total Invested: " + formattedTotalInvested + ", Estimated Gains: " + formattedTotalGains + ")";
resultDiv.style.backgroundColor = "var(–success-green)"; // Reset to success color
resultDiv.style.color = "var(–white)";
}