1. What is the SoFi Savings Calculator?

The SoFi Savings Calculator estimates the growth of your savings based on daily compounding interest. It uses the current SoFi APY (Annual Percentage Yield) of 4.60% by default to show how your money can grow over time.

2. How Does the Calculator Work?

The calculator uses the daily compounding interest formula:

Where:

• \( A \) — Final amount ($)
• \( P \) — Principal amount ($)
• \( r \) — Annual interest rate (decimal, e.g., 0.046 for 4.6%)
• \( t \) — Time in years

Explanation: The formula accounts for daily compounding, where interest is calculated and added to the principal balance each day.

3. Importance of Compound Interest

Details: Compound interest allows your savings to grow exponentially over time, as you earn interest on both your original principal and the accumulated interest.

4. Using the Calculator

Tips: Enter your initial deposit in dollars, the annual interest rate as a decimal (4.6% = 0.046), and the time period in years. The calculator will show your projected balance.

5. Frequently Asked Questions (FAQ)

Q1: What is SoFi's current APY?
A: As of 2023, SoFi offers 4.60% APY on savings accounts, but this rate may change over time.

Q2: How often is interest compounded?
A: SoFi compounds interest daily and credits it to your account monthly.

Q3: Are there any fees?
A: SoFi savings accounts have no account fees, but always check current terms.

Q4: What's the difference between APR and APY?
A: APR doesn't account for compounding, while APY does. APY gives a more accurate picture of earnings.

Q5: How accurate is this calculator?
A: This provides an estimate assuming constant rate and no additional deposits/withdrawals.