See how your savings and investments grow over time with our free compound interest calculator. Enter your principal, interest rate, compounding frequency, and monthly contributions to see a year-by-year growth chart. Compound interest is the foundation of long-term wealth building — Albert Einstein reportedly called it the eighth wonder of the world.
Compound interest is interest calculated on both the initial principal and the accumulated interest from previous periods. Unlike simple interest (which only applies to the principal), compound interest causes your money to grow exponentially over time.
Most Canadian high-interest savings accounts compound interest daily or monthly. GICs (Guaranteed Investment Certificates) typically compound annually or semi-annually. The more frequently interest compounds, the faster your money grows.
The Rule of 72 is a quick mental math shortcut: divide 72 by your annual interest rate to estimate how many years it takes to double your money. For example, at 6% annual return, your investment doubles in approximately 72 ÷ 6 = 12 years.
The Canadian stock market (S&P/TSX Composite) has historically returned approximately 7–9% annually before inflation over long periods. A diversified portfolio of Canadian and global index funds has historically returned 6–8% annually after fees. Past performance does not guarantee future results.