Last updated: 2026 assumptions reviewed. Assumptions & sources
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Compound Interest Calculator

If I invest $500 a month for 25 years, what do I end up with? See the real numbers, watch the growth chart, and see why starting early is the most important financial decision you can make.

The three parts of any balance
What you put in→What it earns→What the earnings earn
The third box is the whole point. It is small for years, and then it is larger than everything you ever contributed.

Your Investment Plan

A one-tap starting point. Adjust anything below.
$
What you're investing today. Can be $0.
$500
$
7.0%
Historical average for a balanced Canadian portfolio: 5 to 8 percent. Use 7 percent as a sober starting point for long-term equity funds.
25 years
years old
Used to show your age at each milestone in the table below.

Your Results

$0
Final Value
$0
Total Contributed
$0
Growth (Interest Earned)
0%
Return on Contributions
The shaded band is interest. Watch it overtake what you actually contributed.

Year-by-Year Growth

Year Age Total Contributed Balance Interest Earned

Return Rate Benchmarks

High-interest savings (HISA)
~4 to 5% right now. Safe, liquid. Good for emergency funds and short-term saving.
Conservative balanced fund
~4 to 6% long-term. Mix of bonds and equities.
Broad market index fund
~7 to 10% long-term before inflation. The S&P 500 has averaged ~10%. Canadian market somewhat lower.
After inflation (real return)
Subtract ~2 to 3% from nominal returns. A 7% nominal return is roughly 4 to 5% real over time.

The Rule of 72

Divide 72 by your annual return rate to see how long your money takes to double. At 7%: 72 ÷ 7 = ~10 years. At 10%: ~7.2 years.

Where to invest

In Canada: start with TFSA for flexibility, then RRSP if high income (the deduction is worth real money). FHSA if you're a first-time buyer. It's the best deal in Canadian tax law right now.

Not sure which? Use the RRSP vs TFSA tool →
Tools Dan uses

Start the compounding

These numbers only matter once real money is invested. Wealthsimple lets you start with $1, no minimum, and automate a monthly contribution so compounding actually begins.

Open a Wealthsimple account →

Affiliate link, no cost to you. How this works. See the full list of tools Dan recommends.

Frequently Asked Questions

What is compound interest?

Compound interest is interest earned on both your principal and the interest already accumulated. Unlike simple interest (which only earns on the original amount), compound interest grows exponentially over time. A dollar invested at 7% doubles in about ten years.

How often does compound interest compound?

It depends on the account or investment. Daily compounding is common in savings accounts. Annual compounding is typical for simple illustrations. More frequent compounding results in slightly higher returns. The calculator lets you choose the compounding frequency so you can compare.

What return should I assume for long-term investing in Canada?

For diversified index fund portfolios, historical long-term returns have averaged around 7-10% before inflation. After a 2% inflation assumption, a real return of 5-7% is a reasonable planning figure for long-term projections. More conservative projections use 5-6%.

How does starting early affect compound interest?

Dramatically. Someone who invests $200 per month from age 25 to 65 at 7% accumulates significantly more than someone who starts at 35 with the same amount, even if the 35-year-old contributes more total dollars. The first ten years of growth cannot be recovered. Starting early is the most powerful move available.

Is compound interest the same as the Parable of the Talents?

Not directly, but the principle rhymes. The servant who invested and grew what he was given was commended. The servant who buried it out of fear was rebuked. Compound interest is one mechanism by which faithful stewardship of resources over time produces growth. It is not a guarantee, but it is a tool worth understanding.