# Compound interest calculator

Our compound interest calculator helps you to project the development of your savings, adapted to your individual situation. So that you know whether and how investing money is profitable.

Our compound interest calculator helps you to project the development of your savings, adapted to your individual situation. So that you know whether and how investing money is profitable.

Your advantage with findependent* CHF 0

* We calculate with 0.5% interest on the savings account and for the forecasts the past performance based on index data, minus management fee, custody fee and ETF costs since 2005 is used (net return). It is not a guarantee for the future market performance. The actual asset value achieved may differ significantly from the forecasts.

**Controllers**

With the compound interest calculator, you can use the controllers to define not only your investment sum but also the monthly savings amount. Then you decide on one of the four findependent investment solutions. By default, we have selected the investment solution *Balanced* to calculate the return. Finally, you choose how far into the future the compound interest calculator should calculate the performance of your savings.

**Calculation basis for savings account**

For savings accounts, we calculate an interest rate of 0.5% in the yield calculator. Individual banks may also offer higher interest rates, but usually only for a limited account balance or a specific term.

**Calculation basis for investment solution**

Our interest calculator calculates your savings potential with a findependent investment solution. Your investment advantage is proportional to the investment duration, the starting amount, the deposit amount and interval and the interest rate. For example, the longer you “hold” your investment, the higher the expected return, and the more often you pay in, the greater your capital growth will ultimately be. Your performance is not proportional, but – thanks to the compound interest effect– rather exponential.

Which functions are you missing? What would you like to see improved in our yield calculator? Let us know: hello@findependent.ch.

Compound interest is, as the name suggests, interest that accrues on your existing interest. If you reinvest the interest from your investment, you will earn interest on it again. The longer you reinvest your earnings, the more you benefit from this effect, the so-called compound interest effect.

A side note: By interest here we mean the return. That is why it should correctly be called “returns” and not “compound interest”. The compound interest calculator would then be called yield calculator. However, the term compound interest has definitely become established.

So how can you put the calculations of the compound interest calculator and the knowledge gained into practice? With an investment solution, you can save cleverly and make significantly more from your savings in the long term than if you bunker them in your savings account. Kay talks about the compound interest calculator in the video and sums it up again with an example.

The video is in lovely Swiss German. However, you can enable English subtitles.

**Risk**

Financial markets fluctuate and no one can predict exactly how they will change. Therefore, even with findependent’s compound interest calculator, there is no guarantee that your investment will actually develop in this way. We make assumptions when calculating returns, which are of course not universally valid. However, they are based on actual, historical values.

**Fees**

Investing money is always associated with certain costs. In addition to product costs and external transaction costs, there are usually fees for administration and custody account management.

Just like your interest rates, the level of your fees also plays a major role. The lower the fees of your investment solution, the more of your savings will be left for you.

**Fee-free amount & fees for findependent**

With findependent you benefit from paying no management and custody fees up to an amount of CHF 2’000 – for life.

On your investment sum above CHF 2’000 you pay 0.40% per year. From CHF 50,000, we have also introduced a sliding scale, with fees gradually decreasing down to 0.29%. You can find the exact scale in the fee overview.

Further details on costs and our fee calculator can be found here.

Albert Einstein commented on compound interest at the beginning of the 20th century. There are various quotes attributed to him.

**“Compound interest is the eighth wonder of the world. Whoever understands it earns from it, everyone else pays for it”**

Einstein is also said to have said that the **“greatest invention of human thought is compound interest”**.

How much money after 10 years of ETF savings plan?

That depends primarily on the chosen investment strategy and the level of fees. With findependent’s pure risk-averse equity strategy, the final value after 10 years is around CHF 84,000 (with a starting amount of CHF 2,000 and a monthly deposit of CHF 500)

How much money in the account is normal?

You should always have enough money in your account to pay your running costs. In addition, 3 to 6 months’ wages have proven to be an appropriate nest egg. However, the exact amount depends heavily on your own standard of living and the amount of your salary.

What is the maximum amount of money you should have in your account?

That depends very much on what purchases you have planned. Money that you will need in the next 3 years should be left in your savings account despite low/no interest rates. Savings that you won’t need for at least 3 to 5 years or more can be invested.

Compound interest is, as the name suggests, interest that accrues on your existing interest. If you reinvest the interest on your investment, you will earn interest on it again. The longer you reinvest your earnings, the more you benefit from this effect, the so-called compound interest effect.

Another side note: By interest we mean the return.