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.

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40
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6answers
17k views

What to do with $1,000,000.00 for 3&1/2 months?

We have 1 million dollars from the sale of a farm, which we want to use to pay down land debt. But we can't make a payment until the anniversary date of July 5. Right now it is in an interest ...
3
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1answer
68 views

What determines the interest rates of government bonds?

It's not clear to me how the interest rate of a specific government bond changes. I would like to make a comparison with cryptocurrency exchanges. Consider, for example, the price of bitcoin on ...
0
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1answer
103 views

Nonresident aliens do not need to pay tax on earned interest?

I am a nonresident alien living in the USA and paying federal and state taxes on my salary. I am working in a university in Colorado with a J1 visa which is valid from 06/24/2018. I have a social ...
6
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1answer
1k views

Calculation on Accrued Interest on typical student loan

I was reading an article on accrued interest as it pertains to student loans, and this is what was said: "Say you borrow $5,000 each year you’re in school at an interest rate of 5% each year. ...
0
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0answers
114 views

Spouse earns $50 K yearly, you $0. How much tax on joint HISA?

We both maxed out RRSP, TFSA. Each has 3.3% HISA at Laurentian Bank. We don't want deposit over $100 K, CDIC's coverage. No other CDIC institution pays 3.3%. We open a joint HISA — 2 below — and only ...
1
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3answers
148 views

Must I file Form 1099-INT for interest on a business loan from an individual?

The 2020 Instructions for Forms 1099-INT and 1099-OID says that "you are not required to file Form 1099-INT for interest on an obligation issued by an individual", but I don't understand what they ...
1
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1answer
91 views

Finance loan calculation [closed]

I was trying to do some maths in excel, I was able to calculate the amount I will be paying for a 40000USD loan at a 13.9% (7 years) based on amortised scheduled repayments with a constant interest ...
1
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2answers
301 views

$0.30 1099 tax form received, should I ignore it?

Context: I am not an US citizen nor do I live in the US (I live in Europe). 4 years ago, I was working in the US and had a bank account there. Then I moved to Europe in my home country. I have some ...
1
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0answers
106 views

How do I deal with taxes on a U.S. Savings Bond that matured a few years before it was redeemed?

My parents recently found a 30-year Savings Bond of mine that matured in 2016. I redeemed it at the bank in late 2019. My understanding is the correct way to handle this is to file an amended 2016 ...
0
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2answers
218 views

Credit cards: Is it worth using the interest-free period on a second card?

I am about to start a 12 month part-time course, requiring variable but monthly payments. To maximise my budget I want to pay for it via credit card, but am trying to understand which method will end ...
7
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3answers
898 views

How to calculate savings account interest if you deposit and withdraw irregularly?

It's easy to calculate interest on a fixed principal. If you have for example $1000 deposit on your savings account and the rate is 0.25% compounded every whatsoever and you want to know how much is ...
-3
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1answer
105 views

How does one calculate the following loan problems? [closed]

1.) Calculate the total interest to be paid on the loan during it's lifetime. Compute for BOTH compound interest and simple interest models. Start Principal = $21,315.00, Date of Disbursement = 9/...
2
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1answer
95 views

What happens when I make a purchase on a credit card after the promotional purchase window but before interest is due?

Sorry for the poor question title. I couldn't think of a better way to word it. Suppose I have a credit card that offers a promotional no interest for 12 months on purchases made in the first 60 ...
0
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5answers
304 views

Why is interest paid on the outstanding amount instead of the whole amount of a loan?

For a large proportion of loans, why is interest paid on the outstanding amount instead of the entire amount of a loan? For example, for a 100.000 loan with a 10% interest, basic logic would imply ...
3
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1answer
87 views

How is interest calculated on a UK type 1 student loan?

On my student loan annual statement it says The Student Loan Company applied interest to my balance every month but only received one lump sum payment at the end of the year from HMRC, even though ...
1
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1answer
133 views

When I capitalize amortization table, the present value doesn't equal the sum of PV or the XNPV

How is it that when I capitalize an amortization table, the present value doesn't equal the sum of PV or the XNPV formula of all the future payments? If I capitalize the future payments with the same ...
0
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1answer
89 views

loan and interest rate [closed]

A loan payment of $4200 was due 3 months ago, and another payment of $1800 is due in 6 months from now. When should a single payment of 5800.00 be paid to settle the debt if interest is to be 2%?
1
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1answer
59 views

Does the concept of Fixed Deposit exist in the U.S. for foreign nationals?

There exists a pretty simple concept of Fixed Deposits in India where some banks pay up to 7% return per annum with a good deal of flexiblity. This is a good option for those who want to have a ...
1
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3answers
204 views

What is a reasonable percent of income used to pay interest on consumer debt?

I was looking at a breakdown of the Ontario government debt and 11% of tax dollars go to pay interest. I am interested to compare with personal finances, would 11% of annual income as interest be ...
0
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2answers
187 views

Does this scheme work for double-earning on stock market growth + high interest savings?

Suppose I have a high-interest savings account that earns 2% interest. Suppose also that the stock market will grow 5% per year. It seems you'd have to choose to divide your money between the two and ...
1
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3answers
220 views

When to schedule direct debits to maximise interest

Assuming my debit (current) account pays me interest on the funds that are in the account, my intuition is telling me that it makes sense to schedule direct debits for the day before I'm paid. This ...
5
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6answers
2k views

How does paying extra on my mortgage affect my amortization schedule?

I am a first time home buyer and have some spare cash after my home purchase to pay forward quite a bit of money (cash was not available during actual purchase, so, no, I could not have put it towards ...
1
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1answer
121 views

PCP opening balance seems very high

I’ve just received my first statement from my first PCP car agreement and I’m very confused. My credit amount was £20,500 ish and my statement shows that my opening balance 29 days later (when my ...
0
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3answers
174 views

How do credit card companies decide the amount of principal to charge interest on the revolving account?

EDIT: This question is not a duplicate of When to pay a credit card in order to avoid fees/penalties/interest? as that question asks how to avoid interest, as to where I am asking which amount of ...
0
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2answers
209 views

Excel formula for compound interest?

I would like to make an excel formula according to this situation: Person A / Person B Person A invests 1000$ every year from 18 to 28, and then holds it until age 65. It compounds every year with 8%...
0
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0answers
70 views

Why would anyone buy a bond with a negative interest yield? [duplicate]

According to this article I read from MSN today, markets around the world are trading bonds at a negative interest yield. This to me seems completely insane - bonds standing over time should ...
0
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1answer
164 views

Monthly Compound Interest calculation

I am terrible at finance and math so this really hurts my brain but I want to work out the compounding monthly interest for an initial amount over x days. For example I have $1500 over 95 days at 10%....
5
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1answer
337 views

Calculate interest on mortgage

I have been trying to arrive at the same interest figures that my bank charged me on my mortgage, however I am off by a few dollars so I must not be using the correct formula. I have a 30 year ...
2
votes
3answers
136 views

Consequences of jumping from one 0% interest credit card to the next?

What are the negative consequences (if any) of moving from one 0% introductory rate credit card to the next, every 12-15 months (whatever the rate period happens to be). This is for someone with great ...
2
votes
2answers
85 views

Calculating Annuities With Different Compounding period and Interest Period

Can anyone Help me solve this? In July 2010, Mike deposits $100 semiannually into an account compounding quarterly at 7% nominal annual interest for three years. In July 2013, he increases the ...
0
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4answers
239 views

How to calculate total interest payments for debt with two interest rates?

If a debt accrues interest at an annual rate of 8% on the principal balance up to $1,500, and it accrues interest at an annual rate of 18% on the portion of the principal balance above $1,500, and if ...
0
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1answer
126 views

How is Barclays Everyday Saver interest rate calculated

I searched online and they said it's 0.25%-0.30% per year. But since my balance is ever-changing, how do they really calculate the interest? Do they just snapshot your balance on a certain day of a ...
0
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1answer
64 views

How to benefit from different forward rates

This is an exam question that I cannot answer using my textbook so I came to this site for help: Assume that I can buy a 2, 2 forward rate of 11% at the stock market, that is in two years I can ...
2
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4answers
292 views

Do extra mortgage payments typically go directly towards principal?

I have a 30 year mortgage and I'd like to make extra payments each month to speed up the amortization schedule. I thought this would be better than taking out a 15 year mortgage as it gives me some ...
2
votes
2answers
189 views

Student loans w/ employer contribution payoff strategy

I have $17k in student loans (4 of them, all Stafford less than 4.5%). My monthly minimum payment is under $200, and my employer contributes exactly $200 on my loans each month (regardless of minimum ...
3
votes
1answer
83 views

Can my student loan interest apply for an above-the-line deduction when I'm on my grace period?

I was reading this article on 2019 tax deductions: https://www.fool.com/taxes/2019/01/13/your-2019-guide-to-tax-deductions.aspx I recently graduated college in May and started work in July 1st. I ...
0
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3answers
116 views

Hypothetical Question About Mortgage and Yield [closed]

Making These Assumptions: I have $1M, I want to buy a house which costs $1.5M. I want to have a mortgage of $500K. The interest rate on my mortgage is 2.5% annually. Assuming I rent the house and ...
1
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6answers
410 views

Advice on loan to friend

I am writing up a legal document (USA, Michigan) for loaning 7k to a friend with 10% APR with a term length of 5 years. (known him 5 years, he has paid back many smaller loans before). We'll both ...
0
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2answers
249 views

Why do so many people calculate an annual average return of 10% in stocks when multiple banks offer funds that yield only 3-5% or lower?

In recent months, multiple banks and financial advisers have asked me if I would be interested in investing in stocks because I have some spare money. They showed me different funds that they thought ...
2
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2answers
65 views

Profitability of Holding a Loan from Issue to Maturity

The loans that I invest in pay a fixed amount of money per month. A portion of it is principal and another portion of it is interest. As the loan matures, a smaller proportion of each payment is ...
0
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1answer
42 views

How to calculate equivalent interest rate of gains with monthly contributions?

I started the year with a known amount of funds in my account and I make regular (assume equal) monthly payments into the account. I know how much my gain/interest for the year is. I believe the ...
0
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2answers
418 views

Help with a homework question calculating interest

Question : Imagine that you deposit $6,000 a year, starting one year from today, for four years into a savings account paying 6% per annum. (That is one deposit of $6,000 per year.) How much money ...
2
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1answer
191 views

Negative rates on government bonds

Take the german 10J-Bundesanleihe for example, as far as I know the rates for it went negative recently. Is there any incentive for private investors / or institutional ones to invest now into this ...
6
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1answer
215 views

Should I pay taxes on additional money I received due to exchange rate?

Let's take the below example - I send $1000 to India NRE account when exchange rate is $1 = Rs. 70 Money in NRE account = $1000 x 70 = Rs. 70000 I keep that money in NRE account at 7% interest Rs. ...
0
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2answers
1k views

Will banks allow one spouse to get an auto loan to buy a car from the other spouse

My husband was in an accident with our family’s van so we have to buy a new one. The insurance is paying off our existing note in full. We have found a pre-owned van that we want to purchase as a ...
1
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1answer
177 views

When is margin interest charged?

Let's say that I have a margin account at a major broker like TD Ameritrade or Interactive Brokers. I am trying to calculate what my cost would be to use margin and I would also like to know when it ...
4
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2answers
184 views

Help on calculating credit card interest

Below is a summary of my current statement Apr 21 2019 - May 2019: The APR is 25.24% I had a promotional 0% APR till Apr 20. This is it google drive link I have tried my best to calculate the ...
4
votes
4answers
572 views

If Turkey doesn't go bankrupt, is there any chance they won't pay bonds profits?

Suppose I buy 5000$ worth of Turkish treasury bonds today and the yearly interest rate for 1Y bonds is roughly 25%. Assuming Turkey doesn't go bankrupt in the next year, is there any chance I won't ...
1
vote
2answers
562 views

Excel table to compute interest on savings account that is compounded daily but paid monthly?

I have an excel sheet that represents a real world savings account which interest is compounded daily but paid out monthly. It looks like: Example Table For clarity, I will call each row in the "...
2
votes
2answers
277 views

How much do I need to save per month in an interest-bearing account to reach a certain account balance in a certain number of years?

How do I calculate what my monthly contribution should be to an interest bearing account, knowing how much I'll need to have in the account in a given number of years? For Example, I need $8,203.03 ...

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