1APR is for borrowing
You see it on cards, car loans and mortgages. Lower is better.
2APY is for saving
You see it on savings accounts and CDs. Higher is better, and it already counts compounding.
3Why APY is higher than the rate
Interest paid monthly starts earning interest itself. On $10,000 at 4% paid monthly, you earn about $407 in a year, not $400.
4Compare like with like
Compare APY with APY when saving, and APR with APR when borrowing.
How to do it in Oaktally
Earning interest helps most when you keep adding to it. Oaktally keeps your savings goals next to your bills.
- Make a savings goalIn Plan, add a goal with a target and choose Target date.
- Save the amount it showsOaktally shows what to save each month to get there.
- Add money each paydayThe ring shows how far along you are.
Try it with your numbers
Enter your target, what you have and your deadline.
Plan deposits by dateFrequently asked questions
Is a 5% APY good?
It depends on current rates. Compare it with other accounts' APY on the same day.
Do credit cards use APY?
No. Cards show APR, even though interest compounds.
Further reading
CFPB: The difference between a loan's interest rate and the APR ↗FDIC: Financial products that are insured ↗Educational examples, not individual financial advice.
