Compound Daily Vs Monthly

happyharold4 | Jan 19, 2023 | 388 posts since 2022

Can someone do the math on this example. Both accounts have 100K and both at 4.00% for one year. What would be the actual dollar amount of difference between compound daily vs monthly. Thanks

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Answers

CTM | Jan 19, 2023 | 179 posts since 2010

Negligible. Based on a 365 day year and the standard formula, the numbers are:

$ 4000.00 - Annual
$ 4074.15 - Monthly
$ 4080.85 - Daily

sams1985 | Jan 19, 2023 | 781 posts since 2022

Daily: $103,997.62
Monthly: $103,991.20

(Assuming 4% APY 3.92% APR daily 3.93% APR Monthly)

happyharold4 | Jan 20, 2023 | 388 posts since 2022

Thanks a bunch both of you for posting up. Much appreciated.

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