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CAGR Calculator

CAGR represents the smoothed annualized rate of return required for an investment to grow from its beginning balance to its ending balance over a given timeframe, dampening the volatility of year-to-year swings.

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Wealth & Investing(4 tools)
Instant Answer & Solution

How to calculate: $50,000 grows to $120,000 over 6 years

CAGR: 15.71% per year
Formula:CAGR = (Ending Value / Beginning Value)^(1 / n) – 1
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n is the number of years between beginning and ending valuations.

Need custom inputs? Use the interactive calculator below:Live Tool
Compound Annual Growth Rate (CAGR)
15.71% / year

About CAGR Calculator

CAGR represents the smoothed annualized rate of return required for an investment to grow from its beginning balance to its ending balance over a given timeframe, dampening the volatility of year-to-year swings.

Primary Purpose: Calculate Compound Annual Growth Rate across multiple periods

How to Use the CAGR Calculator

  1. 1Enter Starting Value (Beginning Balance).
  2. 2Enter Ending Value (Final Balance).
  3. 3Enter Number of Years or Periods.
  4. 4View the exact CAGR percentage.

Formula & Methodology

CAGR = (Ending Value / Beginning Value)^(1 / n) – 1

n is the number of years between beginning and ending valuations.

Real-World Worked Examples

Startup revenue growth

$50,000 grows to $120,000 over 6 years

Inputs
beginning:50000
ending:120000
years:6
Result:CAGR: 15.71% per year
Comprehensive Editorial Guide

What Is CAGR and How Is It Calculated?

Understand Compound Annual Growth Rate (CAGR), why it outperforms arithmetic average return, and how to apply the formula.

Read Guide

Frequently Asked Questions

When should I use CAGR instead of average annual return?

Average return can be misleading due to compounding effects (e.g. +50% followed by -50% equals a net loss of 25%, not 0%). CAGR reflects true actual geometric growth.