The effective annual interest rate is the actual return on a savings account or other interest-bearing investment when the effects of compounding are considered. It also reflects the real ...

Here's the formula: Real interest rate = nominal interest rate - rate of inflation (actual or expected) Here is an example from an investor's point of view. Say the initial interest rate on a bond ...

which is why the real interest rate provides a better picture of either. For example, putting $1,000 into a savings account that earns 2 percent annual interest at the start of the year would ...

Doing the math and crunching the numbers when it comes to figuring out your loan's interest can be complicated. Here's how to ...

The simple interest formula The formula for simple ... it is known as a coupon payment. For example, a $1,000 bond with a 6% coupon (interest rate) pays $60 per year, or $30 semiannually.

He is an expert on personal finance, corporate finance and real estate ... more accurate. For example, the Rule of 72 states that $1 invested at an annual fixed interest rate of 10% would take ...