How does a bank interest rate work? and what is percentage annual yield?

im thinkin about opening a savings account with $1000, how does the bank interest rate get compounded. Their website doesnt say. also, what is this stuff about annual yield? their interest rate is .25% and so is annual yield

By | 2013-08-25T03:22:05+00:00 August 25th, 2013|Mortgages Home Loans Interest Rate|1 Comment

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  1. Judy August 25, 2013 at 3:44 AM - Reply

    With an interest rate of .25% I would not even bother figuring it out.
    You are not even getting 1% on your money per year.
    Now, think about that.
    What’s 1% of 1,000 = 10 dollars
    Now, divide that by 4 – $2.5 dollars / year you are earning.

    If you are 17 or older you can open a student checking account which pays no interest but will teach you how to write checks and use debit cards and atms.
    Interest rates at local savings accounts are worthless.

    Go with an online bank and open a 5 year cd if you want to earn over 5.5% interest.

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