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# SFGI Savings Account Rate Increase

Thursday, January 9, 2014 - 4:49 PMSFGI Direct - Details
SFGI bumped the APY on its' Online Savings
account (from 0.91%) to 1.01% today. Pleases
me---I'm already an existing account holder :)
14
cumulus339 posts since
Jan 16, 2010
Rep Points: 1,589
1. Thursday, January 9, 2014 - 5:27 PM
By the way SFGI is one of the very unusual accounts
where the quoted rate is actually identical to the
quoted APY. Thus their quoted rate=1.0100% produces
a true SFGI APY of 1.0151+ %.

Most all places have a rate LESS THAN the quoted
APY.  Generally you have to round up to get their
advertised APY; Ally and numerous others are guilty
of this.

Bottom line: most others would advertise this SFGI
APY as 1.02%.  (Intended for those who count their
pennies.)
5
cumulus339 posts since
Jan 16, 2010
Rep Points: 1,589
2. Thursday, January 9, 2014 - 8:58 PM
The APY is the result of how often the rate is compounded. It could be daily, monthly, quarterly, semi-annually etc. The result of how often the rate is compounded would give you the APY.
6
Ally6770912 posts since
Jan 16, 2010
Rep Points: 2,655
3. Friday, January 10, 2014 - 12:24 PM
Both the compounding frequency (daily, monthly, etc) and the
rate determine the APY.  All other things equal the rate has
the greater influence; for SFGI:  APY = (1+rate/365)^365 - 1
5
cumulus339 posts since
Jan 16, 2010
Rep Points: 1,589
4. Friday, January 10, 2014 - 1:25 PM
Are you stating that SFGI does not compound? If the rate and the APY are the same that would seem to be the case.  The rate is usually the lower of the 2 figures. The APY is the result of the compounding.
4
Ally6770912 posts since
Jan 16, 2010
Rep Points: 2,655
5. Friday, January 10, 2014 - 6:05 PM
> Are you stating that SFGI does not compound?
>
Not at all.  What I am saying is SFGI actually UNDERSTATES its' APY!
The customer is actually getting an APY greater than 1.01%.  In this
case, as noted above (#2), that APY is 1.0151+ %.

Hopefully an example clarifies things. Since both Ally and SFGI
compound daily one might think if the advertised APY's were the
same, you would earn the same. Not so. Back in October Ally had an
advertised APY=0.86%; Ally's rate associated with that APY was a
rate=0.85633 %. Back when SFGI advertised an APY=0.86%, its'
rate=0.86000 %. The exact APY for both Ally and SFGI comes from
the formula  APY = (1+rate/365)^365 - 1

The true   Ally APY=0.85999+ %.
The true SFGI APY=0.86369+ %.

You earn more money at SFGI, even though they both had the same
APY.  I've had an SFGI account since 2009 and they have done
this consistently.
4
cumulus339 posts since
Jan 16, 2010
Rep Points: 1,589
6. Wednesday, January 15, 2014 - 7:25 PM
Looks like time for me to eat some crow!  SFGI's rate for this 1.01% APY
is now set at 1.0000%. (Still a good deal mind you.)  So after adhering to
the very customer-friendly rate settings for APY's of the past few years
(as previously belabored in #1), they now appear to be doing pretty much
what all others do on this.

Perhaps it was a mistake all along; perhaps someone from SFGI is reading
this blog.  Aaaaaargh.
3
cumulus339 posts since
Jan 16, 2010
Rep Points: 1,589
7. Wednesday, January 15, 2014 - 7:48 PM
APY is always more than the rate unless they do not compound. APY (Annual percentage yield) is the result of the rate being compounded.
2
Ally6770912 posts since
Jan 16, 2010
Rep Points: 2,655