Compound interest
What a monthly habit turns into
My plan
What you put in on day one. Zero is fine.
Paid at the end of each month, in the same currency.
What it costs me
Charged on each monthly payment.
After 20 years
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Paid in, earned, and lost to costs
Total paid in
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Investment gain
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Why the gap widens
The straight line is your own money, added at the same pace every month. The curve is what it is worth. The gap between them is compounding, and it grows faster than the capital does — that is the whole point of starting early rather than paying in more.
Milestones
| Year | Paid in | Value | Of which gain |
|---|
How the number is produced
Month by month, not year by year — a yearly formula would ignore eleven months of growth on every contribution and understate the result.
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Each month the balance grows at that rate, then the contribution is added, net of the brokerage fees charged on it. The annual return is converted to a monthly one geometrically, so twelve months compound back to exactly the annual figure.
Three balances run in parallel on the same contributions: one net of everything, one without the ongoing charge, and one with no costs at all. Subtracting them is what isolates each cost — the brokerage fees and the fund's ongoing charge are reported separately rather than lumped together, because only one of the two is under your control.
What this does not model: tax, a return that varies from year to year, and contributions that grow with your income. A constant return is a deliberate simplification — markets do not deliver 5 % every year, they average it over a long enough period. Treat the output as the shape of a habit, not a forecast.
Nothing you type here leaves your browser: the whole calculation runs on this page, there is no account and no server call. For the same simulator wired to a real fund's ongoing charge, and to your own holdings, see the ExSys Terminal.