SoFi High Yield Calculator

SoFi Savings Growth Formula:

\[ A = P \times (1 + \frac{r}{365})^{(365 \times t)} \]

Final Amount (A):

Interest Earned:

1. What is the SoFi High Yield Savings?

The SoFi High Yield Savings account offers competitive interest rates (currently 3.80% APY) with daily compounding, helping your money grow faster than traditional savings accounts.

2. How Does the Calculator Work?

The calculator uses the daily compounding formula:

\[ A = P \times (1 + \frac{r}{365})^{(365 \times t)} \]

Where:

$ A $ — Final amount ($)
$ P $ — Principal investment amount ($)
$ r $ — Annual interest rate (decimal, e.g., 0.038 for 3.8%)
$ t $ — Time the money is invested for (years)

Explanation: Interest is compounded daily (365 times per year), which means you earn interest on both your principal and previously earned interest.

3. Importance of Compound Interest

Details: Daily compounding can significantly increase your savings over time compared to simple interest or less frequent compounding. Even small differences in interest rates can lead to substantial differences in final amounts over long periods.

4. Using the Calculator

Tips: Enter your initial deposit amount in dollars, the number of years you plan to save, and the annual interest rate (default is 0.038 for 3.8% APY). All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: How often is interest paid in SoFi savings accounts?
A: Interest is compounded daily and credited to your account monthly.

Q2: Is there a minimum balance requirement?
A: SoFi doesn't require a minimum balance to earn the high yield interest rate.

Q3: Are there any fees?
A: SoFi High Yield Savings has no account fees.

Q4: How does this compare to other savings options?
A: 3.80% APY is significantly higher than the national average for savings accounts (0.46% as of 2023).

Q5: Is my money safe in a SoFi savings account?
A: Funds are FDIC insured up to $250,000 per depositor.