Compound Interest Calculator Canada

See how your investments grow with compound interest. Enter your details and explore interactive charts showing growth over time, year-by-year breakdowns, and more.

Grow your savings faster with tax-advantaged accounts like RRSPs and TFSAs, which shelter your compound growth from taxes.

Investment details

Enter your investment parameters to see how compound interest grows your money over time.

Starting principal

Added every month

Expected annual return

Investment horizon

Your results

Projected growth over 25 years at 7% annual return

Final Balance

$464,652.74

Total contributions: $160,000

Total Interest Earned

$304,652.74

Interest is 66% of your final balance

Growth over time

Frequently asked questions

Compound interest is interest earned on both your original principal and on interest that has already been added to your balance. Unlike simple interest (calculated only on the principal), compound interest accelerates growth over time because each interest payment increases the base for future calculations.
More frequent compounding (monthly vs. annually) means interest is calculated and added to your balance more often, so each subsequent calculation uses a slightly larger base. The difference is modest for typical savings rates but becomes more noticeable at higher rates or over longer periods.
Canadian equity index funds have historically returned 7-10% annually before inflation. A balanced portfolio (stocks and bonds) typically averages 5-7%. GICs and high-interest savings accounts offer 3-5% depending on market conditions. The right rate depends on your risk tolerance and investment mix.
Inflation reduces the purchasing power of future dollars. A 7% return with 2% inflation gives roughly 5% in real (inflation-adjusted) terms. Use the inflation toggle in the calculator to see your projected balance in today's dollars, which gives a more realistic picture of future purchasing power.
Start early, contribute consistently, and use tax-advantaged accounts. An RRSP gives you a tax deduction on contributions and tax-deferred growth. A TFSA offers tax-free growth and withdrawals. Both shelter your investments from annual taxation, letting compound interest work uninterrupted.
This calculator models general compound growth and is useful for estimating how investments in an RRSP or TFSA might grow over time. It does not account for contribution limits, withdrawal rules, or tax implications specific to each account type. Use the dedicated calculators for account-specific details.