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Compound interest + future value

Project a savings/investment balance with monthly compounding + monthly contributions.

What this is

The 8th wonder of the world

Compound interest = earning interest on your interest. The longer the time horizon, the more dramatic the growth. This is the single most powerful concept in personal finance.

  • ·$500/mo at 7% return for 30 years → ~$612,000. You contributed $180k; compound interest delivered the other $432k.
  • ·Rule of 72: years to DOUBLE = 72 ÷ rate%. At 7%, money doubles every ~10.3 years.
  • ·CAGR (Compound Annual Growth Rate) = the steady annual return that gets you from the starting amount to the ending amount.

Future value

$300,851

Total contributed

$130,000

Interest earned

$170,851

Implied CAGR

4.28%

At 7.0% annual return, money doubles every ~10.3 years (Rule of 72).

Balance growth over time

$0$75K$150K$226K$301K048121620Future value (CAD)Years

Contribution vs growth at year 20

You contributed$130KInterest earned$171KFuture value$301K

Educational projection. Real returns are noisy and taxes + fees erode the headline rate. For RRSP/TFSA growth, use the marginal-tax-aware calculators instead.