Example 1: only an initial capital, no contributions
Starting with €5,000 saved, at 6% annual interest, over 15 years, without adding anything else.
| Year | Accumulated capital |
|---|---|
| 0 | €5,000 |
| 5 | €6,691 |
| 10 | €8,954 |
| 15 | €11,983 |
The capital nearly multiplies by 2.4 in 15 years, without touching anything else: purely from the effect of compound interest on the same money.
Example 2: initial capital plus a monthly contribution
Now add €1,000 initial capital, plus €100/month, at 7% annual, over 20 years.
| Year | Accumulated contribution | Total |
|---|---|---|
| 5 | €7,000 | €8,397 |
| 10 | €13,000 | €18,147 |
| 15 | €19,000 | €32,309 |
| 20 | €25,000 | €54,618 |
This example makes the cumulative effect clear: in the first 5 years, interest earned is small compared to what's contributed. From year 15-20 onward, interest earned starts to weigh almost as much (or more) than your own contribution.
Example 3: comparing two starting ages
Two people contribute the same (€150/month at 7% annual), but one starts at 25 and the other at 35, both until age 65:
- Starting at 25 (40 years contributing): the result is around €385,000.
- Starting at 35 (30 years contributing): the result is around €183,000.
With just 10 fewer years, the result doesn't drop by a proportional 25%: it drops by more than half. That's the reason it's so often stressed to start early, even with little.