1. What is Investment Return With Withdrawals?

Investment return with withdrawals calculates the percentage return on an investment after accounting for any withdrawals made during the investment period. This provides a more accurate measure of investment performance.

2. How Does the Calculator Work?

The calculator uses the investment return formula:

Where:

• \( FV \) — Future value of the investment
• \( P \) — Principal amount invested
• \( \text{Sum of Withdrawals} \) — Total withdrawals made during investment period

Explanation: This formula calculates the net return percentage by subtracting both the principal and withdrawals from the future value, then dividing by the principal.

3. Importance of Return Calculation

Details: Accurate return calculation is essential for evaluating investment performance, comparing different investment options, and making informed financial decisions.

4. Using the Calculator

Tips: Enter future value, principal amount, and total withdrawals in currency units. All values must be valid (principal > 0).

5. Frequently Asked Questions (FAQ)

Q1: Why subtract withdrawals from the calculation?
A: Withdrawals represent money taken out of the investment, so they must be accounted for to calculate the true net return.

Q2: What is considered a good investment return?
A: Good returns vary by investment type and market conditions. Generally, returns should exceed inflation and benchmark indices.

Q3: Does this calculation consider the time value of money?
A: This is a simple return calculation that doesn't account for the timing of investments or withdrawals.

Q4: Can this calculator handle multiple withdrawals?
A: Yes, but you need to provide the total sum of all withdrawals made during the investment period.

Q5: What if I made additional investments during the period?
A: This calculator is designed for a single principal investment. For multiple investments, a more complex calculation would be needed.