Start with $10,000, add $300 every month, and earn 6%. After 20 years you have $171,714, and $89,714 of it is interest. Type in your own numbers below and see how your plan stacks up.
When does the growth really show up?
Later than you’d think. In the example above, interest is $6,420 after five years but $47,787 after fifteen. Each year’s interest is earned on a bigger balance, so the yearly gain keeps climbing. Here are the balances at every fifth year.
| Year | Paid in | Interest | Balance |
|---|---|---|---|
| 5 | $28,000 | $6,420 | $34,420 |
| 10 | $46,000 | $21,358 | $67,358 |
| 15 | $64,000 | $47,787 | $111,787 |
| 20 | $82,000 | $89,714 | $171,714 |
By year 20 the interest is bigger than everything you paid in. The result also lists every single year, so you can find any point in between, like the year your balance passes $100,000.
What if you start with nothing, or with a lump sum?
Plenty of people begin with nothing saved, and that’s fine. Try $500 a month at a 5% return over 30 years. You pay in $180,000 and end up with $416,129, so $236,129 is interest.
A lump sum on its own behaves differently. $10,000 at 6% with monthly compounding and no deposits becomes $18,194 after 10 years. And how often it compounds barely matters, as this one-year look at 6% shows.
| Compounded | Interest after one year | Balance |
|---|---|---|
| Yearly | $600 | $10,600 |
| Twice a year | $609 | $10,609 |
| Quarterly | $614 | $10,614 |
| Monthly | $617 | $10,617 |
| Daily | $618 | $10,618 |
What does the calculator assume?
One fixed rate for every year, and a monthly deposit that never changes. Real investments rise and fall, and a savings account rate can move. Don’t read the result as a promise. Test a lower rate as well, say a point or two under your first guess, and see whether the plan still works for you. Taxes, fees and inflation aren’t included. Prices in 20 years will buy less than the balance suggests, so the balance will feel smaller than it looks. And a figure like 6% is a nominal rate, which the compounding schedule turns into a slightly higher effective one.
Should you add more each month or give it more time? Time wins, and it isn’t close. Run the same $300 for 10 years, then for 20. The balance at 10 years is $67,358 in the default example, and it more than doubles by year 20, because the second decade earns interest on a much bigger base.
Where should you go from here?
For a fixed term deposit, use the GIC calculator. If all you want is the interest on one amount with no deposits, the interest calculator compares simple and compound interest. Registered accounts have their own tools, such as the TFSA calculator and the RRSP calculator.
Where the numbers come from
Every result comes from the growth formula in the calculator. It takes the yearly rate is converted to a monthly rate for the schedule you pick, interest is added each month, and the deposit follows at month end. No rates or limits are stored, so each number you see comes from what you enter. This website has no connection with any government body.
Frequently asked questions
How does compound interest work?
Interest gets added to your balance, and the next round is earned on the bigger total. Over many years it snowballs, which is why time matters more than any single deposit.
How much will $10,000 grow in 10 years at 6%?
With no further deposits and monthly compounding it reaches $18,194, and $8,194 of that is interest.
Does compounding more often matter much?
Only a little. On $10,000 at 6% for a year, yearly compounding gives $600 of interest and daily gives $618.
When do my monthly deposits go in?
At the end of each month, after that month's interest is applied. Depositing at the start of the month would give slightly more.
How many years can I test?
Sixty. Anything longer is treated as 60, so split a very long plan into stages.
Sources and updates
Updated: . How we check rates · Editorial team · Updates
Estimate only. These figures are a planning estimate, not tax, legal or accounting advice. Tax-Services.ca is an independent publisher: we don't prepare or file tax returns, and we don't offer tax, legal or accounting services. We have no connection with the Canada Revenue Agency, Revenu Québec or any provincial government. Your real amounts depend on details this tool cannot see, so confirm them with an official source or a qualified professional before you act.