How Do You Calculate Bank Interest Rates?
Banks, credit unions and most financial institutions invest the money that you deposit and pay you an interest fee as compensation. The interest rates vary widely. Learn how to calculate interest rates to find the bank that rewards you the most. Locate the bank interest rates and any relevant information on your bank account statement. If you are comparison shopping, you may request a prospectus from other financial institutions. Use the interest calculation “I=P*R*T” if you know the principal, rate and time of the bank account. The amount of money deposited is the principal. The rate is the bank interest rates you found in Step 1. Finally, time is the number of years for which your principal is earning interest. Plug each individual amount into the calculation noted in Step 2. For example, let’s say you have deposited a principal of $4,500 into a bank account that pays 9.5 percent interest, and you plan to leave the principal in the account for six years. The resulting calculation wou
