ETF Investment Calculator

Many expats in Germany set aside 10–20% of their net income for ETF investments. Even €200/month invested consistently over 30 years at a 6% average annual return could grow to over €200,000. Starting early and staying consistent tends to make the biggest difference.

A globally diversified stock ETF (like MSCI World) has historically returned around 7–8% per year before inflation. After inflation, that figure is closer to 5–6%. Many financial planners use 5–6% in their projections to account for fees and future uncertainty.

Historically, lump sum investing has outperformed dollar-cost averaging (DCA) about two-thirds of the time, since markets tend to trend upward over long periods. That said, DCA reduces timing risk and can feel more manageable psychologically. Most people invest monthly from their salary anyway.

ETF gains in Germany are subject to Abgeltungssteuer (capital gains tax): a 26.375% flat rate including solidarity surcharge. There’s also a €1,000 annual tax-free allowance called the Sparerpauschbetrag. Accumulating ETFs may also trigger a Vorabpauschale — a small annual tax on unrealized gains. Tax rules depend on your personal situation, so it’s worth consulting a licensed tax advisor (Steuerberater).

Time in the market tends to matter more than timing the market. Thanks to compound interest, even a few extra years of investing can make a significant difference to your end result. The calculator above lets you explore how different starting ages affect projections.