How the ETF Savings Plan Simulator Works
This simulator calculates the expected return of a systematic investment plan invested in ETFs, accounting for management costs (TER) and capital gains taxation.
How the Plan Amount Is Calculated
The formula used is that of ordinary annuities: Amount = PMT x (((1 + r)^n - 1) / r)
Where PMT is the monthly contribution, r is the monthly net return (after TER), and n is the total number of months. The gain is then taxed at the applicable rate.
Why Choose an ETF Investment Plan
An ETF savings plan combines three fundamental advantages: Dollar cost averaging (investing a fixed amount monthly reduces timing risk), Diversification (a single global ETF invests in thousands of companies), and Low costs (ETFs have TER between 0.07% and 0.30%, much lower than active funds).
Historical Reference Returns
To calibrate expectations, here are historical average annual returns (gross): MSCI World: ~7-8% (last 30 years), S&P 500: ~9-10% (last 30 years), MSCI Emerging Markets: ~5-6% (last 20 years). Remember that past returns do not guarantee future results.
How to Use the Simulator
Enter the monthly contribution you can sustain, choose the investment duration, set the expected return (7% is reasonable for a global ETF), and adjust TER and taxation for a more precise estimate.