What happens when you invest $500/month at 8% for 20 years?
If you invest $500 per month consistently at an expected annual return of 8% for 20 years, your portfolio grows to $294,510. You will have contributed $120,000 of your own money, and compounding will have added $174,510 in growth — a 2.45x multiple on your contributions.
After a typical 0.5% annual management fee, the final value is approximately $276,865. The total fee cost over 20 years is $17,645 — a reminder that low-cost index funds with fees of 0.03-0.1% preserve significantly more of your returns.
These figures assume a constant 8% annual return compounded monthly. Actual investment returns vary year-to-year and cannot be guaranteed. Use the interactive calculator to model different assumptions.