Reproducing the accumulated interest computed by the bank.

Asked Jun 08 '24 at 07:34

Active Jun 08 '24 at 10:21

Viewed 51 times

I have a Lifetime ISA saving with a 4.4% AER. The current balance is £1,178.04. The website shows that the today's interest is £0.1042.

(As far as I know) The formula is:

$= \frac{(principal * interest rate)}{365}$

$= \frac{1,178.04*0.044}{365} = 0.1420$

Missing for 4 pennies daily.

Same problem with a Hungarian Forint. I have 100,111.21 HUF with 7.00 % APY shows the today's interest is 18.546 HUF.

$= \frac{100,111.21*0.07}{365} = 19.1994$

Missing 0.65 HUF daily.

What am I missing?

edited Jun 08 '24 at 10:21

Henkie

asked Jun 08 '24 at 07:34

Klorissz

1

The formula you show is for simple interest. See Wikipedia: Compound interest or other online resources for more detail. – Daniel Mathias Jun 08 '24 at 11:11
Even considering compound interest (and alternately trying out daily and monthly interest computations), your daily interest in the first case still should be more than that £0.1042. – ryang Feb 11 '25 at 14:50

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