How to Calculate Interest on Bank Deposits
Your bank deposits accrue interest if they are made into interest-bearing accounts -- that's cash added to the total funds in your account. This is customary for savings accounts, and also possible for checking accounts. Regarding checking accounts, you need to find out if your institution offers interest and what the terms are. If your bank doesn't offer interest checking, shop around to find banks that do. The interest figure a bank quotes is annual. Generally, a fraction of the interest is placed in your account each month. To get the most accurate number, calculate the interest for the year.
Other People Are Reading
Instructions
-
-
1
Add the amount of your bank deposit to the balance that is in the interest-bearing account. Include the existing funds, your current and any additional deposits to obtain the total balance of your interest-bearing account.
-
2
Multiply the sum from Step 1 by the quoted interest rate your bank provided. For example, if you have $3,050 in deposits, and the interest rate is 2.2 percent annually, the interest is $67.10 for the year.
-
-
3
Divide the interest from Step 2 by 12. This yields the approximate monthly return. Here, $67.10 means you will have about $5.60 added each month, provided you maintain your account's balance and do not withdraw any money.
-
4
Sum the original deposit with interest to arrive at the account balance at the end of the year. Here, $3,050 in deposits and $67.10 in interest comes to $3,117.10.
-
1
