Finance
Compound Annual Growth Rate (CAGR) Calculator
Average annual growth rate between a start and end value.
Free to use — no sign-up or login.
CAGR
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Amortization schedule
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Compound annual growth rate (CAGR) is the constant yearly rate that would take a starting value to an ending value over a stated number of years if growth compounded once per year. Enter start value, end value, and years; the calculator reports that rate as a percent. It is a smoothing device for comparison, not a claim that every year actually earned the same return.
For a single-period percent gain without years, use the ROI Calculator. To project a present amount forward at a known rate, use Future Value or Compound Interest. The step-by-step identity is How to Calculate CAGR.
Start, end, and years
Start value and end value must be positive. Years must be positive and should match the calendar span between those two snapshots (use fractions of a year if your span is not a whole number of years and you accept that modeling choice). Deposits and withdrawals between the dates are invisible unless you adjust the start or end figures yourself.
CAGR hides the path
Two investments can share the same CAGR and still have very different year-by-year returns. CAGR also is not the arithmetic average of annual returns. Use it to put multi-year outcomes on one annualized scale; do not read it as a guaranteed future rate. A rough doubling-time check at a constant rate is the Rule of 72 Calculator.
Worked example: $10,000 to $16,105 in 5 years
The defaults are start value $10,000, end value $16,105, and 5 years. The ratio is 16105 / 10000 = 1.6105. Raise to 1/5 and subtract one: 1.6105^(1/5) − 1 ≈ 0.10, so CAGR ≈ 10% per year. Checking forward, 10000 × (1.10)^5 ≈ $16,105.
\[ \mathrm{CAGR}=\left(\frac{16105}{10000}\right)^{1/5}-1\approx 0.10\ (10\%) \]
Frequently asked questions
Is CAGR the same as the average of each year’s return?
No. Averaging yearly percentage returns is an arithmetic mean. CAGR is the geometric rate that links start to end in one step. They match only in special cases.
What if the end value is lower than the start?
CAGR can be negative. The same formula still applies: the constant annual rate that declines from start to end over the years you entered.
Can I use months instead of years?
The years field is in years. For an 18-month span, enter 1.5 (or convert your horizon consistently). The output remains an annualized rate under that year count.
Does CAGR include fees or taxes?
Only if you reduce the end value (or raise the start) to reflect them before calculating. The formula itself has no fee input.
Sources
Assumptions and limitations
Finance results are illustrative. They typically omit taxes, fees, prepayment penalties, and product rules, and they are not investment or lending advice.
CAGR assumes positive start value and years, ignores interim cash flows unless baked into the endpoints, and says nothing about volatility or future performance. Figures are illustrative, not investment advice.