This model assumes the interest rate remains constant and that the compounding of interest takes place at the end of the first specified period and each compounding period thereafter. The final value is made up of the single principal amount invested and the interest earned.

Term Deposits
There is no maximum restriction placed on funds deposited into a term deposit or guaranteed investment certificate (GIC). The interest is traditionally compounded annually, but other compound frequencies are available.

Registered Education Savings Plan (RESP)
The RESP is a government approved plan which allows you to save for the future post secondary education of a beneficiary. RESP contributions are subject to annual and maximum lifetime contribution limits.

In order to create an accurate RESP simulation, you must use both "projected value of a deposit" and "projected value of a series of deposits" simulations. First, use the "projected value of a deposit" simulation to calculate the total payments of the plan up to 21 years (current total number of years over which contributions can be made). Then, use the "projected value of a series of deposits" simulation to calculate the value provided after 21 years.

Registered Retirement Savings Plan (RRSP)
The RRSP is a federal government approved method of saving for retirement. Any contributions made to an RRSP can be claimed as tax deductions. RRSP contributions are subject to maximum annual contribution limits. In order to create an accurate RRSP simulation, use your maximum annual contribution limit for the current taxation year.