CAGR Calculator
This CAGR calculator finds the compound annual growth rate between a beginning value and an ending value over a number of years. Enter the three numbers and the CAGR calculator returns the CAGR, the total growth, and the growth multiple. It is the standard way to state an investment's or a business's average yearly growth.
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What the CAGR calculator shows
Compound annual growth rate (CAGR) is the single yearly rate that would turn a starting value into an ending value if growth were smooth. Real growth is uneven, so CAGR smooths it into one comparable number. The CAGR calculator works it out from the start value, the end value, and the years between them.
Compound annual growth rate formula
The ratio of end to start gives the total growth multiple; the root spreads it evenly across the years. Unlike an average of yearly returns, CAGR accounts for compounding, so applying it year after year reproduces the ending value exactly.
CAGR calculator example
An investment grows from $10,000 to $19,500 in 5 years:
Total growth is 95 percent, a multiple of 1.95. Growing at 14.29 percent a year for 5 years turns $10,000 back into $19,500.
How to use the CAGR calculator
Enter the beginning value, the ending value, and the number of years. The CAGR calculator returns the compound annual growth rate as a percentage per year, the total growth in percent, and the growth multiple. Values can be investment balances, revenue, users, or any quantity that grows over time. As a compound annual growth rate calculator and CAGR return calculator, it lets you compute CAGR online in one step.
Reading the CAGR growth rate
CAGR answers what steady yearly rate matches the overall result. It hides volatility: two investments with the same CAGR can have very different ups and downs. Compare CAGRs only over the same period, and remember that past CAGR does not predict future growth.
When to use the compound growth rate calculator
- Comparing funds with the compound growth rate calculator
- Stating revenue or user growth in reports
- Checking a growth target for a plan
- Converting total growth into a yearly rate
Common CAGR calculator mistakes
- Averaging yearly returns. Use the compound formula instead.
- Counting the wrong number of years. 2020 to 2025 is 5 years.
- Ignoring deposits and withdrawals. CAGR assumes none in between.
Tips for accurate results
- Use the same period for every comparison.
- Check volatility, not just CAGR.
- Use IRR when cash moves in and out.
CAGR calculator vs total growth
Total growth tells you how much something grew in all; CAGR tells you how fast it grew each year on average. A 95 percent rise over 5 years sounds large, but as a cumulative annual growth rate it is 14.29 percent per year, which is easy to compare with a fund or an index. Because CAGR uses only the first and last values, it treats the path in between as smooth. When cash goes in and out at several dates, a single growth rate needs the IRR method instead, which the NPV and IRR calculator provides.
Reverse CAGR calculator
A reverse CAGR calculator projects forward: multiply the starting value by (1 + CAGR) for each year. At 14.29 percent, $10,000 becomes about $11,429 after one year and $19,500 after five.
CAGR rate reference ($10,000 start, 5 years)
| Ending value | Total growth | CAGR |
|---|---|---|
| $12,763 | 27.6% | 5.0% |
| $16,105 | 61.1% | 10.0% |
| $19,500 | 95.0% | 14.29% |
| $20,114 | 101.1% | 15.0% |
CAGR Calculator FAQ
What is the CAGR formula?
CAGR = (ending value ÷ beginning value)^(1 ÷ years) − 1.
Is CAGR the same as average annual return?
No. CAGR accounts for compounding; a simple average of yearly returns can overstate growth.
Can CAGR be negative?
Yes. If the ending value is lower than the beginning value, CAGR is negative.
What is a reverse CAGR calculation?
Working forwards: ending value = beginning value × (1 + CAGR)^years.