1. What is the Compound Interest Formula?

The compound interest formula calculates how much your savings will grow over time when interest is compounded daily. The formula accounts for your initial deposit, the interest rate, and the time period.

2. How Does the Calculator Work?

The calculator uses the compound interest formula:

Where:

• \( A \) — Final amount ($)
• \( P \) — Principal/initial deposit ($)
• \( r \) — Annual interest rate (decimal)
• \( t \) — Time in years

Explanation: The formula calculates daily compounding (365 times per year) to show how your savings grow with either Marcus (3.65% APY) or Amex (3.60% APY).

3. Marcus vs Amex Savings Comparison

Details: This calculator compares two popular high-yield savings accounts. Marcus currently offers 3.65% APY while Amex offers 3.60% APY. Even small differences in APY can lead to significant differences over time.

4. Using the Calculator

Tips: Enter your initial deposit, number of years, and optional monthly contributions. The calculator will show you the projected growth for both accounts and the difference between them.

5. Frequently Asked Questions (FAQ)

Q1: What is APY?
A: APY (Annual Percentage Yield) includes compound interest and shows the real rate of return you'll earn in a year.

Q2: Are these rates guaranteed?
A: No, high-yield savings account rates can change. These are the current rates as of 2023.

Q3: Which bank is better?
A: While Marcus currently has a slightly higher rate, both are reputable options. Consider other factors like customer service and mobile app quality.

Q4: How often is interest compounded?
A: Both Marcus and Amex compound interest daily and credit it monthly.

Q5: Are there fees or minimums?
A: Neither account has monthly fees or minimum balance requirements.