Growth can earn growth
With compounding, growth stays in the balance used to calculate later growth. At a fixed 10% effective annual rate, R1 000 becomes R1 100 after one year and R1 210 after two years if nothing is withdrawn. This is an illustration, not a product return.
Contributions matter too. R500 added each month contributes R6 000 a year regardless of market performance. Separating contributions from growth helps you see where the projected balance comes from.
Compare consistent rate assumptions
A nominal rate with monthly compounding differs from an effective annual rate. The calculator takes a nominal annual assumption and converts the selected compounding pattern into equivalent monthly growth.
Beginning-of-month contributions get one more month of growth than end-of-month contributions. When growth is negative, earlier contributions are exposed to that loss for longer.
Think in purchasing power
Inflation reduces what a future rand can buy. A projection of R110 000 in a year with 10% inflation has the same modelled purchasing power as R100 000 today. Use the inflation option to view an illustrative today’s-money balance.
Real products also have taxes, fees, changing rates and investment risk. Revisit assumptions periodically and avoid treating a smooth projection as a promise.
Educational information, not personalised financial advice. This guide was prepared for this release. Read our editorial and corrections policy.