2026-03-27 10:00:00
INVESTMENT
Pension reform: the first step into the power of compound interest
Pension reform provides an opportunity not only to save, but also to start building capital that can grow over time through compound interest—sometimes called the 8th wonder of the world in finance.
We want to show how even a relatively small start, combined with consistent investing, can deliver strong results.
Example 1: Starting with €3,000 + €200 per month, 9% annual return:
Period | Invested amount (€) | Earnings (€) | Portfolio value (€) |
3 years | 10,200 | 1,996 | 12,196 |
5 years | 15,000 | 4,910 | 19,910 |
10 years | 27,000 | 19,320 | 46,320 |
15 years | 39,000 | 48,840 | 87,840 |
20 years | 51,000 | 101,750 | 152,750 |
Example 2: €5,000 initial investment + €400 per month, 9% return:
Period | Invested amount (€) | Earnings (€) | Portfolio value (€) |
3 years | 19,400 | 3,682 | 23,082 |
5 years | 29,000 | 9,250 | 38,250 |
10 years | 53,000 | 37,180 | 90,180 |
15 years | 77,000 | 94,820 | 171,820 |
20 years | 101,000 | 198,450 | 299,450 |
What is important to notice in these examples:
- After 10 years, earnings already make up a significant portion of the portfolio (over 70% of the invested amount)
- After 15 years, earnings exceed the total invested amount
- After 20 years, earnings are nearly 2 times higher than the invested capital
- The greatest value is created not when the most is invested, but when investing continues consistently over the longest period
Key insight:
The greatest driver of capital growth is not the amount of money, but the time spent investing.
Please note that investing involves risk.
