CAGR Calculator
Work out the compound annual growth rate (CAGR) between any two values, then flip it around: solve for the final value at a target rate, or for how long a goal takes. You also get total return, the value change, doubling time, an optional forward projection, and a full show your work breakdown.
Formula
Worked example
$1,000 grows to $2,500 over 5 years: (2500/1000)^(1/5) − 1 ≈ 20.1% per year (150% total). At that rate the value doubles about every 3.8 years.
How CAGR Works
CAGR is a geometric mean: it captures the single hypothetical rate that, compounded annually over the period, connects the starting value to the ending value. Unlike a simple average of annual returns, CAGR accounts for compounding, so it always produces a lower figure when returns vary from year to year. It is expressed as a percentage and applies equally to investment portfolios, revenue figures, subscriber counts, or any metric that grows over time.
How to Use This Calculator
Enter the beginning value, the amount at the start of your measurement period, followed by the ending value and the number of full years between those two points. Select your preferred currency if you are working with monetary figures. The calculator returns the CAGR as an annualized percentage. Make sure the beginning and ending values reflect the same basis (for example, both pre-tax or both post-fee) to keep the result meaningful.
What Affects the Result
The length of the period has the largest influence: extending the time span smooths out short-term volatility and typically moderates the resulting rate. The ratio of ending to beginning value is the other direct input, a doubling over 10 years produces a lower CAGR than a doubling over 5 years. Currency selection changes the display label but does not alter the calculated rate, since CAGR is a ratio. Interim cash flows, dividends received, capital added, or withdrawals made, are not captured by a simple CAGR and will cause the figure to diverge from an accurate return calculation.
Limitations and Important Considerations
CAGR describes historical growth between two specific points and says nothing about volatility or risk along the way; two investments can share an identical CAGR while one experienced severe drawdowns and the other grew smoothly. It also ignores taxes, fees, and the timing of any cash flows during the period. For investments with irregular contributions or withdrawals, internal rate of return (IRR) or money-weighted rate of return is a more appropriate measure. This calculator is provided for general informational purposes only and does not constitute financial, investment, or tax advice; consult a qualified financial professional before making any investment decisions.
Reverse solve: final value, target rate or time needed
The same formula rearranges three ways, so this calculator does more than read a rate off two values. Switch the "Solve for" menu to "Final value" to grow a starting amount forward at a target CAGR over a set number of periods, which answers "what will this be worth if it compounds at 8% for 10 years". Switch to "Time needed" to find how many years it takes to reach a goal at a given rate, using years = ln(target / start) divided by ln(1 + rate). Because every period count is converted to years first, you can enter the span in years, quarters or months and still read the result as an annualized rate. The doubling time output applies the rule of 72 in exact form, ln(2) divided by ln(1 + rate), so you can see how fast money compounds at the rate you found.
What a given CAGR turns $10,000 into
| CAGR | After 10 years | After 20 years | Doubling time |
|---|---|---|---|
| 4% | $14,802 | $21,911 | 17.7 yr |
| 6% | $17,908 | $32,071 | 11.9 yr |
| 8% | $21,589 | $46,610 | 9.0 yr |
| 10% | $25,937 | $67,275 | 7.3 yr |
| 15% | $40,456 | $163,665 | 5.0 yr |
Final value of a single $10,000 lump sum compounding at a steady annual rate. Doubling time uses ln(2) / ln(1 + rate).
Frequently asked questions
Is CAGR the same as average annual return?
No. A simple average annual return adds each year's return and divides by the number of years, which ignores compounding. CAGR uses a geometric calculation that accounts for the effect of compounding, so it is always equal to or lower than the arithmetic average when returns vary across years. For assessing how an investment actually grew, CAGR is the more accurate measure.
Can CAGR be negative?
Yes. When the ending value is lower than the beginning value, the result is a negative CAGR, indicating the investment or metric declined at a compounded annual rate over the period. A negative CAGR is mathematically valid as long as the ending value is greater than zero; if the ending value is zero or negative, the standard CAGR formula cannot be applied.
How many years should I use when calculating CAGR?
Use the actual number of full years between the start and end dates of your measurement period. Shorter periods, typically fewer than three years, can make CAGR misleading because a single strong or weak year dominates the result. Most investment professionals use at least three to five years to give CAGR figures meaningful context, and longer periods are generally more informative for evaluating long-term compounded growth.
Can this calculator solve for the final value or the years needed?
Yes. Use the "Solve for" menu at the top. "Final value" grows a starting amount at a target CAGR over a chosen number of periods. "Time needed" tells you how many years it takes to reach a target value at a given rate, using years = ln(target / start) divided by ln(1 + rate). The default mode solves for CAGR from a start value, end value and time span.