How much should you invest each month?

There's no universal number. How much you should invest each month depends on your income, fixed expenses and time horizon. But there are proven principles that help you find your figure — and the data shows that starting with a little today beats waiting to start with a lot tomorrow.

  • The 20% rule: aim to direct at least 20% of your net income to savings and investment
  • €100/month for 30 years at 7% annual return turns into about €122,000
  • The difference between starting at 25 vs. 35 can mean more than double the final portfolio
  • Small, consistent investing beats large but irregular contributions
  • Automate it: set up a standing order on payday
  • Increase your contribution by 10% every time you get a pay rise

The 50/30/20 framework

The most widely used framework splits your net income into three blocks: 50% for needs (rent, food, transport, bills), 30% for variable spending and leisure, and 20% for savings and investment. On a net income of €2,000, that 20% is €400/month. Not everyone can reach that percentage immediately — but it's the target to work towards.

If you can't save 20% yet, start with any positive number: €50, €80, €100. The important thing is to build the habit and the automation. Once the habit is in place, scaling is much easier.

What happens with €100, €200 and €500/month

Results of investing monthly at a 7% average annual return (approximate MSCI World historical return before inflation):

€100/month: at 10 years → €17,300 | at 20 years → €52,100 | at 30 years → €122,000
€200/month: at 10 years → €34,600 | at 20 years → €104,200 | at 30 years → €244,000
€500/month: at 10 years → €86,500 | at 20 years → €260,500 | at 30 years → €610,000

Notice the progression: most of the growth happens in the last 10 years, not the first. That's compound interest in action: the early years are the sowing, the later years are the harvest. That's why time in the market is more valuable than the amount invested.

Why starting with €50 beats waiting to start with €200

Imagine you're 28 today and could invest €50/month. Your friend decides to wait 4 years until earning more, then invest €200/month. At age 60:

You (€50/month for 32 years at 7%): ~€74,000
Your friend (€200/month for 28 years at 7%): ~€178,000

In this case your friend wins — they invested four times more. But notice the more typical scenario: the person who waits doesn't end up investing four times as much because living expenses absorb most of the income increase. If your friend invests €80 instead of €200 when they start: you end up with more money having invested less in total.

The conclusion: start with what you can today.

How to set your monthly figure in 3 steps

Step 1 — Calculate your real margin: list all your fixed monthly expenses and subtract them from your net income. What's left is your available margin.

Step 2 — Build an emergency fund first: before investing, have 3–6 months of expenses in a savings account or money market fund. If you don't have one, direct half your margin towards building it.

Step 3 — Automate on payday: set up a standing order so that on the day you're paid, your contribution automatically goes to your broker or fund. Investing 'what's left at the end of the month' doesn't work — there's always something to spend it on.

When and how to increase your contribution

The simplest rule: every time your salary increases, direct 50% of the net increment to increasing your monthly contribution. If you earn €100 more per month, invest €50 more. The other 50% improves your quality of life. That way your portfolio grows alongside your lifestyle without you noticing.

Other good moments to review your contribution: when a loan ends (put the freed payment amount straight into investing), year-end bonus (invest at least 10% of it), and each January as part of your annual financial review.

Frequently asked questions

How much of my income should I invest?

A common starting point is 10–20% of net income, once you have an emergency fund and no expensive debt.

Is investing $50 a month worth it?

Yes. Starting early builds the habit and gives compound interest more time. You can increase the amount later.

Should I invest before paying off debt?

Pay off high-interest debt first. Low-interest debt, such as a mortgage, can coexist with investing.

When should I increase my contribution?

With every pay rise or when a debt is paid off. Automating the increase makes it painless.

Read further

  • Just Keep Buying (Nick Maggiulli). It gives you: Puts data behind the questions other books answer with opinions: how much to save and when to buy.
  • Misbehaving (Richard H. Thaler). It gives you: Links biases to concrete money decisions, such as saving or spending.