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Questions tagged [interest]

for questions that relate to interest. Interest is a fee paid by a borrower of assets to the owner as a form of compensation for the use of the assets.

3
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2answers
132 views

How best to apply back Student Loan Refund?

After completing Undergrad December 2017 I began making payments on my student loans (#1-5 below), paying more than necessary on the smallest balance of my 6.8% loans (usually owe $340, paying $500). ...
5
votes
4answers
354 views

Is home equity worth taking out a mortgage when I have $67k student loans to pay?

Note: home equity isn't the only reason I'm thinking about buying. I'd like to have control over my own living environment, more space, not have to worry about annoying the apartment unit upstairs if ...
40
votes
10answers
17k views

Why would anyone buy U.S. Treasury Bills?

From the Treasury Direct website, I saw this Bills: U.S. Treasury Bills are a type of short-term security of one year or less, usually issued at a discount. The discount is the amount the security ...
0
votes
2answers
211 views

Are you out of pocket if moving before paying mortgage interest?

Please could somebody clarify the following scenario for me (first time buyer)? Are there any tips? Any differences if moving from one lender to another? Supposing I take out a 25 year mortgage on a £...
0
votes
2answers
171 views

How are micro-finance banks able to offer interest rates so much higher than traditional banks?

Recently while browsing on google I came to know that there are few small-finance banks which offer great returns with the high amount of interest rate up to 7% and fixed deposits up to 9-9.5%. like ...
4
votes
4answers
2k views

Do pension pots get interest? [closed]

Pension pot is the money, the employee and sometimes the employer and the government pay that gets accumulated into pension fund. But my question is, that this pension fund is basically a bank ...
0
votes
1answer
24 views

Tax system on savings account in India

I would like to know if the money in the bank is taxable. Let's say I have deposited some x amount in my savings account and the yearly interest is y amount. I know that this y amount is taxable, but ...
3
votes
2answers
61 views

Filing a tax return due to US bank interest for non-US persons

Does the mere ownership of a US bank account that earns some interest require a non US person (say, based in Europe, EU in particular) to file a US tax return? Are there any other reporting ...
0
votes
1answer
76 views

Simple Interest calculation on rent of specific period till date of payment

Hi I have to calculate simple interest on Rent of Rs.10,000 @6%. There are two parts to my problem. Calculation of simple interest on rent amounts due for 41 months progressively i.e. as rents keep ...
3
votes
3answers
172 views

How to know how much money was paid, and how much was spent paying off interest

I would like to buy a car, and found out about the 20/4/10 rule today. I definitely have more than 20% downpayment saved up, due to that I am not concerned with the 20 part. I am more concerned about ...
-1
votes
1answer
1k views

Minimum Nest Egg in Today's Dollars? [closed]

As a follow-on to this question, if you wanted to have a $2.5 million nest egg in 20 years, what would the nest egg value have to be today (assuming no future contributions)? Assume: 20 years ...
1
vote
1answer
38 views

Effect of FED/ECB interest rate on EUR/USD exchange ratio

In 2016, the ECB has lowered interest rate to 0%. Some people assume that within the next few years, the ECB will increase the interest rate. How would that most probably affect the EUR/USD exchange ...
1
vote
1answer
366 views

Minimum Required Nest Egg Formula?

As a follow-up to this question, what is the minimum size of a nest egg to support 30 years of $5,583.33 monthly distributions? I want the $5,583.33 to increase with inflation each month. The ...
1
vote
3answers
310 views

Does IRS charge interest for underpaid taxes?

There is a rule that if no taxes are owed on last year's tax return, the IRS will not impose a penalty, but will interest be charged? Example: assume no federal taxes have been withheld during 2018. ...
1
vote
1answer
121 views

Best way to allocate money? Mutual Fund VS Student Loan

I am a 21 year old Canadian who is employed full time. I have no wife or kids nor do I own any property. I have no type of savings set up (investments, CPP, etc.). Each month I have 400$ leftover ...
4
votes
4answers
3k views

How does compound interest work with stocks? [duplicate]

I just learned about compound interest, and I want to know if I understood it right: You buy a stock, and then you just keep it. And over time, you will just earn interest on your interest. Is that ...
0
votes
1answer
103 views

Minimum interest needed to keep money at same value with 4% inflation?

For 30 years, my calculation says 7.17%, which just doesn't seem right. Say you invest $1 each year for 30 years with a return of investment of 7.17% Total investment from your end = $ 3 Total ...
0
votes
1answer
171 views

How should you calculate the average daily return on an investment based on a history of gains?

I started an Acorns account several months ago to use as a glorified savings account. I don't make contributions on purchases, but I contribute 10% of my paycheck to it every two weeks (Richest Man ...
2
votes
3answers
285 views

Why would a lender raise interest rates if you are in danger of not being able to pay your loan?

This is a follow-up to this question. It is established that lenders charge higher interest rates to customers less likely to be able to repay their loan in full, but this increased rate shouldn't ...
1
vote
1answer
93 views

How do you calculate a monthly loan payment when using Actual/365 or Act/Act day count convention?

It is pretty easy to figure out a monthly loan payment based on the standard formula, when using a 30/360 method, because the monthly interest rate is always the same since each month has 30 days. ...
2
votes
1answer
94 views

Are longer or shorter term CDs preferable while interest rates rise?

As of August in 2018, everything I'm reading is projecting rising interest rates for a while. Assuming that this is what happens, is it better to deposit money into a shorter-term CD (at a lower ...
57
votes
10answers
13k views

Why don't bond makers just get loans?

I was just looking at investment opportunities, and I found a number of places offering bonds paying up to 12% interest over two years. My first thought was, I can get a loan from my bank for 5% ...
0
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1answer
33 views

Interest on community shares - tax return

I invested in a community project under the Seed Enterprise Investment Scheme. In the year I invested I claimed SEIS tax relief on the investment. In return for my investment I received shares in the ...
1
vote
1answer
90 views

How many days of interest do I lose if I make a wire transfer from one bank to another?

I suppose this will depend on the banks, so what's typical? Do any banks do this in 0 days? What's the longest which would still be allowed by law? Both bank accounts are already established and in ...
2
votes
1answer
80 views

Comparing bank to bond ETF

Let's say I have a bank savings account giving this interest: Rate: 1.736% APY: 1.75% (rate accounting for compounding interest) And there's a bond ETF SCHZ with these rates: TTM: Distribution ...
2
votes
1answer
49 views

How to Aggregate APR

I currently have several different credit accounts with balances that need to be paid off, and I am considering consolidating these accounts into a single loan account. These accounts each have ...
0
votes
0answers
27 views

Is there any way to compare a tracker's interest with an average fixed rate?

I have been paying into a tax free index tracking account for a number of years, the amounts were only occasionally regular and varying in size. I haven't withdrawn anything. I have exported data ...
1
vote
1answer
79 views

Credit Cards: Cash Financing Charges

I have a credit card, where the terms and conditions have this to say about cash withdrawal: B. Cash Advance Fees The Cardholder can use the Card to access cash in an emergency from ...
0
votes
1answer
134 views

Credit card 25day billing interest

I have a Home Depot credit card that is supported by TidewaterFinance. I was charged interest on my purchase even though I had zero balance 2 cycles ago and never received a bill last month because I ...
1
vote
1answer
108 views

What kind of parameters do you look at before investing? [closed]

As the title says, when you are about to invest long/medium term into a company, which kind of parameters do you look at (beside the fundamentals) P/ E ratio? P/ Revenue? Can you help a noob please?...
0
votes
3answers
167 views

How to use credit card with balance on it?

I have a credit card that currently has balance on it past grace period. I am working on paying it out, but I also need it to pay for online purchases, etc. I know that once you are past grace period,...
2
votes
2answers
315 views

Is simple interest related to the actuarial method?

I'm trying to understand different methods of calculating interest on installment loans. I keep coming across the terms "simple interest" and "actuarial method". They seem to be related but I haven'...
0
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0answers
83 views

I am being offered whole life insurance with a savings account. Should I take it?

I am being offered a savings account with a Whole life Insurance policy. I believe it is 100,000 policy for $30 a month. However, half of this goes to a savings account with a 4% "compound interest."...
1
vote
2answers
1k views

Can you calculate 10-year Treasury Note yield from price or vice versa?

I grabbed this screenshot from CNBC this morning: Are the price ($98.0469) and yield (2.981%) mathematically related? Investopedia says "A 10-year Treasury note pays interest at a fixed rate once ...
0
votes
0answers
34 views

What happens if you pay off a credit card with deferred interest before the date, but then use it again? [duplicate]

What happens if you have paid off a Credit Card that had deferred interest to avoid the interest penalty, but you then decide to use it again? When that date comes around and it sees there is a ...
1
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0answers
63 views

Lending club investments through a numbered company for favorable tax?

I'm part of a lending club in Canada that has just allowed corporate lending. My marginal tax bracket in Canada is 26%, so I'm trying to figure out if there is an advantage to lending through a ...
0
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0answers
66 views

How is interest rate calculated for a floating mortgage

I am trying to calculate the amount of interest I need to pay for a mortgage that just turned from fixed to floating. Current balance is: -550,000 Interest rate: 5.95% Original term: 30 years The ...
1
vote
2answers
281 views

Compound Interest & Mortgages

Mortgages are compounded 2 times a year in Canada and 12 times a year in the USA. However, I read that mortgages are simple interest and not compound interest because you pay the interest for each ...
1
vote
2answers
101 views

What's an easy way to create a floating amortization loan? [duplicate]

When dealing with a mortgage company, paying off a loan is quite simple. Now everything is online and most of the times you can pay more than the minimum payment each time. Each month the interest ...
3
votes
2answers
100 views

Daily Interest Monthly Compounding Multiyear

I downloaded the Excel spreadsheet mentioned in the accepted answer to this question: Daily interest calculation combined with monthly compounding: Why do banks do this, and how-to in Excel? It was ...
2
votes
1answer
125 views

If I'm taking the standard deduction, do I still have to enter my school loan interest?

Title says it all. If I know in advance I'll be taking the standard deduction, do I still have to enter and submit my student loan interest? Or any itemized deductions, for that matter?
3
votes
1answer
74 views

Does my life insurance company have to tell me the interest rate for borrowing on my cash value before I process the loan?

I have a permanent (whole life) insurance policy. I want to take out a loan on my cash value, so I called the company to get information. The company representative told me that they would give me ...
0
votes
0answers
38 views

Which two loans out of the three should I pay off? [duplicate]

The answer to this question is what I was basing my payment plan off of. To summarize, the answer says to pay off the loan with the highest interest first. I have three loans: Loan A: Principal ...
0
votes
0answers
40 views

What is the proper name for the formula which calculates interest for the account with the variable funds amount during the billing period?

Let's assume we have an investment fund with holders, who may transfer funds from this fund between each other. We can track how much funds each holder has on his account at any moment. There is some ...
1
vote
2answers
229 views

Finding monthly payment for ordinary simple annuity with varying interest rates? [closed]

I've been working at this question for some time now and I'm quite stuck. Some help would be greatly appreciated. I can figure out recurring payments by themselves, but I'm drawing a blank when it ...
3
votes
0answers
75 views

allocation of payment between principal and interest

Individual made a (second) mortgage loan to another. The loan has been in default for many years. The bank (first mortgage holder) foreclosed on the property. The individual lender received a ...
2
votes
1answer
144 views

Take out a small loan or use money from bank

I'm trying to get some different opinions on what I should do. I'm selling my home and buying another. The difference is $25,000. I have $50,000 in my bank account, no debt, $10,000 in a Roth IRA and ...
9
votes
4answers
3k views

Shouldn't a Roth IRA accumulate more than 1 cent of interest per month?

Ten months ago, I opened a Roth IRA with an initial principal of $1,000, invested in one of those "Target Date" retirement mutual funds. I also set up $100 automatic monthly contributions. The ...
1
vote
2answers
314 views

equivalent monthly cost with multiple interest rates

Is equivalent monthly cost equal to equivalent annual cost divided by 12? Also, using the equivalent annual cost HERE, how would I change the formula for differing rates over the period of time. ...
4
votes
1answer
728 views

High Interest Savings Account vs Bond ETF

Which of the following is a better investment for long term investing and why? High interest savings account paying 2.3% interest, no account fees and the funds are protected by the Canada Deposit ...