Savings Calculator
Calculate how your savings will grow over time with compound interest
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Frequently Asked Questions
How is savings account interest calculated?
Most savings accounts calculate interest daily based on your closing balance, but pay it out monthly. The formula typically used is: (Daily Balance × Interest Rate) / 365. These daily amounts accumulate and are deposited into your account at the end of the month.
What's the difference between simple and compound interest?
Simple interest is calculated only on the principal amount you deposited. Compound interest is calculated on your principal per plus any interest you've already earned. Compound interest allows your savings to grow faster over time because your interest earns interest.
How much should I have in savings?
Financial experts generally recommend having an emergency fund covering 3 to 6 months of living expenses. Beyond that, your savings targets should align with specific goals like a down payment, vehicle purchase, or retirement.
What's a good savings account interest rate in Canada?
A 'good' rate is typically one that beats or matches inflation. High Interest Savings Accounts (HISA) from online banks often offer rates significantly higher than traditional big banks, sometimes ranging from 3% to 5% or more during promotional periods.
How often is interest paid on savings accounts?
In Canada, interest on savings accounts is almost always calculated daily and paid monthly. The interest payment usually appears on your statement on the last day of the month or the first day of the following month.