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suzct
06-15-2006, 10:33 PM
I am thinking of opening a savings acct w/ them as we have a little extra sitting around in our checking acct earing nada. I am financially challended. Could someone explain how the compounded interest works? For example, if we put \$1000 to start and didn't touch it for a year, how much would we make? I think the % now are 4XXX% /
Thanks

disneychrista
06-16-2006, 12:13 AM
It basically mean you earn interst on your interst.

Month 1 you earn interest on your \$1000
Month 2 you earn interst on your \$1000 + the interest earned in month 1
Month 3 You aren interest on \$1000 +month 1 interest + month 2 interest

Example:
Month 1 \$1000, interest earned month 1 \$15
Month 2 \$1015, interest earned month 2 \$15.23
Month 3 \$1030.23, interest earned month 3 \$15.43

Hedy
06-16-2006, 07:16 AM
Numerically:
A=P(1+(R/n)^nt)
Presuming the rate didn't change:
1000*(1+.0425/12)^12
\$1043.33 after one year

canwegosoon
06-16-2006, 07:40 AM
Numerically:
A=P(1+(R/n)^nt)
Presuming the rate didn't change:
1000*(1+.0425/12)^12
\$1043.33 after one year
Hedy...Those were the days!!! Finance 101!!! :teacher:

disneysteve
06-16-2006, 08:17 AM
http://www.bankrate.com/brm/cgi-bin/savings.asp

This is a nice simple savings calculator.

Hedy
06-16-2006, 08:43 AM
Hedy...Those were the days!!! Finance 101!!! :teacher:
I'm a geek, sorry.