Questions tagged [apy]

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3
votes
3answers
215 views

Does it make sense to ladder CD's if the APY is the same for different periods?

I understand that CD ladders are a mechanism to take advantage of the various interest rates offered for different time periods. Given that, is there any point investing in longer and longer term CD's ...
1
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2answers
59 views

CDs vs saving account - which is better if both have same APY?

Currently Marcus by Goldman Sachs is offering the same APY for a 7-Month No-Penalty CD and for an Online savings account. AFAIU a savings account has full liquidity, while the CD forces you to stay ...
7
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1answer
2k views

What is the typical compounding/amortized period on US mortgage loans

In a different question it is stated that Mortgages are compounded .. 12 times a year in the USA Is this true or just applicable to that question? I am looking at a site where it explains how to ...
0
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0answers
27 views

Does the annual percentage yield (APY) take into account the expense ratio? [duplicate]

For example, the APY of SPAXX (Fidelity® Government Money Market Fund) is currently 1.84 for the past year whereas the expense ratio is 0.42%. Does that mean that the pre-tax yield is 1.84% or 1.84%-...
1
vote
1answer
67 views

Why does a short-term certificate of deposit (CD) have a significantly smaller annual percentage yield (APY) than a saving accounts in some banks? [duplicate]

I see on Ally Financial's website that a 3-month certificate of deposit (CD) has an annual percentage yield (APY) of 0.75% whereas the saving account has an APY of 1.60%. This surprises me because I ...
0
votes
1answer
42 views

Finding the price of an item years earlier from compound interest, simple interest, or APY

Is there a way to use the compound interest formula, simple interest, or APY to find the price of something years earlier if the price of it was increasing by a certain percentage annually?
1
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1answer
418 views

Help me understand and calculate credit union interest in Google Sheets

I have opened a savings account at a credit union and deposited $100. Every month my account tells me I've received $0.02 in interest, and that my deposit dividend is 0.250% and my APY earned is 0.23%...
0
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1answer
75 views

Need help figuring out what yearly interest would be?

Even referencing several articles, I can't seem to figure this out; the dividend rate for a savings for instance with $1,000 says it would be 0.10%, compounded quarterly, to me. That means: 1st ...
1
vote
2answers
742 views

Does a savings account's advertised “APY” account for compound interest?

From what I've read, typically "APY" typically refers to the effective interest rate of an account (or loan) over the year, while accounting for compounding effects -- for instance, https://www.ally....
9
votes
3answers
3k views

“Simple interest rate of 0.10%” corresponds to “APY of 2.54%-5.00%”… how?

This checking account says Balances above $5,000 earn a simple interest rate of 0.10%, with a corresponding APY of 2.54%-5.00% APY. I don't understand how a simple interest rate that is a fixed ...
1
vote
2answers
1k views

How does the APY get applied on a CD that is less than one year?

I know that for interest rates you calculate the monthly rate by dividing by 12 (or similarly for any period by the number of periods/year). But if I have a 3 month CD that has a 0.4% APY, does that ...
0
votes
1answer
694 views

Interest Rate vs. Annual Percentage Yield (APY) [duplicate]

I'm curious as to what the difference between the Interest Rate and Annual Percentage Yield is. For example: This Bank I was looking at offers 0.45% interest rate on savings account balances over $...
2
votes
1answer
354 views

Difference between APR and APY [duplicate]

Possible Duplicate: What is the difference between Interest Rate and APY? Can you explain to me the difference between APR and APY and which one I should care about more? I know that comparing ...
12
votes
1answer
9k views

What is the difference between Interest Rate and APY?

What is the difference between Interest Rate and APY on savings accounts, CDs, etc? Is there a simple formula to convert the two?