03-06-2017 09:38 AM
So, apparently I do not understand how interest on a savings account works. I apologize in advance if I'm just being totally goofy here for not understanding.
03-06-2017 10:13 AM
APR and Interest on a Savings account are per year not per month. So talk the .995% interest rate and divide by 12 months that is how much interst would roughly be applied in a month, its a bit more involved in that mathmatically but that will be close.
03-06-2017 10:16 AM
03-06-2017 12:18 PM
Barclays has a Dream Account with a 1.05 APY as well. They also give you a bonus for 1). Making 6 consecutive monthly deposits, and/or 2). Going 6 consecutive months without making a withdrawal. So, it is possible to get both bonuses every 6 months. Each bonus is 2.5% on the past 6 months interest. You're not going to get rich, but it's something!
03-06-2017 04:58 PM
The most cost effective way to make money from bank accounts is not to try to earn interest. Even if somebody has $10,000 in a savings account at 1% interest, that's still only $100 per year -- and that's before taxes.
Instead, you may want to consider the hobby of bank bonus chasing. That's where a bank offers a promotion for opening a savings or bank account with them. E.g. a $300 promotion. You open the account, get the $300, then close it maybe six months later. Yoy can easily make $1000 a year doing that, often much more.
If you want to couple that with high interest savings options, there are some places that offer 5%, though there is typically a ceiling of how much you can put in. (e.g. 5k)
03-06-2017 06:56 PM
So, apparently I do not understand how interest on a savings account works. I apologize in advance if I'm just being totally goofy here for not understanding.My situation - I recently opened a savings account with Alliant CU because they had the highest rate I could find that did not also have a ginormous balance requirement. Their rate is -- .995%. Anywhere else I came across was considerably less. Again. I needed somewhere that didn't require a $10k (for example) minimum balance. Alliant's requirement was that interest starts accruing after the first $100 deposit. I don't make a lot of money but I want to start saving for a down payment for a house. My goal is $25k and my time frame is 2 years.So for the purpose of this post I will leave out the month of January since the amounts varied too much and there was not a full month's time involved in the calculations. Though I will say, my interest for January was 12 cents.Anyway, I opened the 2nd statement period with an approx $600 balance and closed it with an approx balance of $1,100. So, in theory I should have gotten at minimum $5.97 in interest, correct? That is assuming .995% on a $600 balance for the duration of the statement period. But, really it would have a been a little more, just depending on the additional deposits and how many days interest accrued on those during the month.I would have been fine with $5.97 and that's what I was kind of expecting when my statement cut the other day. But, to my surprise and dismay, my interest on my 2nd statement was on $.76. That's 76 cents for anyone who missed it. I have never had an interest bearing savings acct before but that seems wrong to me.That's it???? What am I missing? I am no math whiz but I can figure simple interest. I even plugged in my numbers into a few simple interest calculators just using the $600.00 and it also shows that I should have accrued $5.97 in interest in on monthI am clearly missing something. Can someone please explain how this works so I can adjust my expectations. Thanks!I just verified all of this from my last statement:Feb 2017 (2/1/2017 - 2/28/2017)Opening: $605.26Deposits: $500.76Ending Balance: $1,106.02Dividends Earned: $0.76APR: 1.00%Deposit Dividend: 0.995%
Interest rates are so low that it's not even worth worrying about, but the interest rate is per annum, not per month.
03-10-2017 12:10 PM
I'm interested in getting a new savings account. I have $8400 in a Discover savings account. Though for some strange reason my interest paid DROPPED even though I added more money to it. For a $8300 balance it paid me $6.47 but for a $8400 balance next month it gave me $6.07. Adding $100 more it droped 40 cents which is weird.
03-14-2017 07:59 AM
That, along with if money is added/subtracted from the balance throughout the month, that can affect interest accrued. It is based off of the average daily balance, not just the total sum on the last day.
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