Spend Check is not just a compound interest calculator - it's a conversational tool to understand the opportunity cost of small purchases over time. Every purchase decision has a hidden cost: the potential growth that money could have achieved if invested instead. By visualizing this opportunity cost, Spend Check helps you make more informed financial decisions and build long-term wealth.
Enter the cost of your intended purchase. This could be anything from everyday discretionary spending like shoes ($50-200), watches ($100-800), coffee ($3-5/day or $1,100-1,800/year), dining out, electronics, or larger purchases like furniture. The average American spends about $1,200 monthly on discretionary items - money that could be working for your future instead.
Enter your expected annual return rate. Well-diversified equity portfolios have historically returned 8-12% annually, often outperforming the S&P 500 by 2-4 percentage points when actively managed. More aggressive or concentrated portfolios can see 10-15% returns, with some concentrated portfolios achieving even higher rates. Conservative estimates use 7-8%, while aggressive growth portfolios might target 10-15%. Consider your risk tolerance and investment timeline when setting this rate.
Enter the investment timeframe in years. For retirement planning, this is typically your years until retirement. The power of compound interest becomes most dramatic over longer periods - even an extra 5-10 years can double your final amount. Remember, successful long-term investing requires discipline to leave the money in your account and resist the temptation to dip into retirement funds for discretionary spending. Consider your age, retirement goals, and when you'll truly need access to these funds.
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