A savings account typically pays interest that is expressed as a yearly interest percentage rate. The actual interest, however, is paid into the savings account monthly. At times, you may want to calculate the monthly savings interest or the amount of interest your savings account earned in a particular month. You can calculate the account's monthly interest if you know some basic information about the annual interest rate and the amount of money deposited into the account.
- Skill level:
- Moderately Easy
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Determine the interest rate of the savings account. For example, assume the savings account pays 5 per cent interest.
Determine the amount of money deposited in the savings account. For example, assume your savings account has a £65,000 balance.
Multiply the interest rate from Step 1 by the balance from Step 2. Continuing the same example, .05 x £65,000 = £3,250. This figure represents the yearly interest paid on your savings account.
Divide the yearly interest figure from Step 3 by 365, the number of days in a year. Continuing the same example, £3,250 / 365 = £8.90. This figure represents the daily interest paid on the savings account.
Multiply the daily interest figure from Step 4 by the number of days in the month --- for instance, July. Continuing the example, the interest paid for July is £8.90 x 31 = £276.0. This figure represents the monthly interest paid on your savings account.
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