Calculating the End Balance

Posted By: Dr. Frugal in Saving on 09/13/2007 at 20:58:31

You can use the APY for more than just deciding which deposit products to pick--it can help you figure out what your ending balance will be at the end of a year's investment. Here's the formula, it's really simple: Balance*(1+APY)=Ending Balance.

If you plug in some numbers, like 10k as your beginning balance at .03557% you'll get $10,355.70. Difficult, I know.

It is important to note though that banks quote APY on deposit products even if the term is shorter or longer than a single year. The idea is to give you a tool to compare deposit products, not necessarily provide accurate quotes/ If the product has a one-year terms, then the APY will give you what it will earn over the term. However, if the product has a six-month term, the APY is not what you will earn in six months.

Comments

No comments yet. Future commenting has been disabled.

Sections

Budget (33)
Credit (31)
Currency (22)
Economics (86)
Frugality (74)
Loans (42)
Politics (18)
Saving (37)
Taxes (42)

Related:

All in the Timing

Consumer Spending

Financial Planning Acronyms

Spending can be saving

Building Your Savings


Most Popular

Free Turbo Tax 2018

Most Recent


Feeds


RSS/XML Feed