Compound interest

Sources and assumptions

Calculation assumptions

• This calculator freezes no legal rate: the return, the duration, the contributions and the inflation rate are your own entries. The default rate is a starting value, not a market return — replace it with the one your product actually offers. Hence the absence of any tax year on this page.
• The rate entered is an effective annual rate: capital left on its own is multiplied by (1 + rate) every year. With monthly or quarterly contributions, compounding follows the same cadence at the equivalent periodic rate — changing the frequency never changes the annual return, only the date from which each contribution starts earning interest.
• Amounts are shown before any tax: no income tax, no flat-rate withholding, no social levies are computed here. Taxation depends on the wrapper (regulated savings account, life insurance, equity savings plan, securities account) and belongs to the dedicated calculators.
• No fees are deducted: entry, management, switching or account-keeping fees all reduce the actual return. Contribution ceilings specific to each wrapper are not checked either, nor the fortnight rule of regulated savings accounts.
• The rate of return and the inflation rate are assumed constant over the whole period. This is a projection, not a forecast: a past return says nothing about future ones.
• The balance is tracked to the exact cent and rounded for display only. Cumulative interest is the difference between the final capital shown and what you paid in.