Shakeel Muzaffar

Learn how to calculate return on investment with the ROI formula, step-by-step math, worked examples, and the one limitation you should know.

ROI vs annualized return: total ROI is your whole-period gain, while annualized return (CAGR) turns it into a yearly rate so you can compare investments fairly.

What is a good ROI? It depends on risk, asset, and time. A common benchmark is the S&P 500 near 10 percent a year before inflation over the long run.

Learn how to calculate the future value of your savings with the plain FV formula, a worked example, and a 30-year projection table you can follow.

How often should interest compound? More frequent compounding, daily over monthly, lifts your effective yield, but the gains shrink toward a fixed limit.

APR vs APY explained simply: APR is the plain yearly rate for loans and credit, while APY includes compounding for savings, so APY is always the higher number.

Compound vs simple interest: simple grows on principal alone in a straight line, while compound grows on principal plus interest and speeds up. See the gap.

The Rule of 72 is a mental shortcut: divide 72 by your rate of return to estimate the years to double your money. At 8 percent, about 9 years. See the math.

How compound interest works: you earn interest on your principal plus the interest already added, so your balance grows faster the longer you leave it.

Sinking funds vs emergency funds: a sinking fund saves on purpose for a known future cost, while an emergency fund covers urgent surprises. Keep both separate.