Set a goal, and start working towards it
If you have a specific goal in mind, it's important to know what you need to start doing today in order to reach that goal. Your goal might be a target value for your portfolio or an amount you need to accumulate (own equity for a real estate purchase, a big planned purchase). Set the goal, the initial amount you currently have and the assumed returns, and see how much you need to put in every month in order to meet your goal.
Example
Using the calculator's own defaults: starting with €10,000 already invested, a €500,000 target, a 20-year horizon, and a 7% expected annual return.
To reach that target, you'd need to invest €909/month. Over 20 years, that's €228,138 of your own contributions, with the remaining €271,862 - more than half the final total - coming from investment growth.
Using the calculator's own defaults: starting with €10,000 already invested, a €500,000 target, a 20-year horizon, and a 7% expected annual return.
To reach that target, you'd need to invest €909/month. Over 20 years, that's €228,138 of your own contributions, with the remaining €271,862 - more than half the final total - coming from investment growth.
How to use it
- Initial Investment - the value of any portfolio you already hold today.
- Target Portfolio - the amount you want to reach.
- Period (Years) - how long you have to get there.
- Annual Increase (%) - if you expect your monthly contribution to grow over time (e.g. with salary increases), enter that expected step-up here.
- Expected Annual Return - your assumed average yearly return over the period.
FAQ
What if the required monthly investment seems unrealistically high?
That usually means one of two things: the timeline is too short for the target, or the target itself needs revisiting. Try extending the period or lowering the target to see how much difference either change makes - small changes to your timeline often have an outsized effect thanks to compounding.
What's the difference between this and the Investment Calculator?
They look at the same topic but from two opposite directions; The Investment Calculator starts from a monthly amount and tells you what you'll end up with. This one starts from a desired target and works backwards to tell you the monthly amount required to reach it. Use whichever matches the question you're actually asking.
Does this account for fees?
No, the calculation assumes your full return compounds with no fee drag. See my first and second TANSTAAFL posts for a real breakdown of how much ongoing fees can cost you over a similar timeline.
What if my timeline is short — does that change how I should use this?
Yes, and it's worth being cautious here. This calculator assumes one fixed annual return for the entire period, but real markets don't deliver a smooth, constant return - they deliver a wide range of outcomes that only starts to average out over long stretches of time. Over 20–30 years, a 7% assumption is a reasonable rough guide. Over 2–3 years, it's much less meaningful - a single bad year can dominate the result entirely, and the actual outcome could land far above or far below what the calculator shows. The shorter your horizon, the less you should treat this number as a reliable target, and the more it's worth considering a lower expected return, or a lower-risk portfolio, to reflect that uncertainty. I go into this in more depth in Back to the future(s), which starts with exactly this problem.
Is this financial advice?
Absolutely not - this is an illustrative tool to help you plan toward a specific goal, not a personalized recommendation. If you want a plan built around your actual circumstances, that's exactly what financial planning is for.