What are interest rates?

Question

like car and credit cards etc.....

Answer 1

Are you serious?

Ok it means if you borrow $100 on day August 25, 2008 at a 1% interest rate on Auugust 26, 2008 you will owe the lender $101.00. So for ever $100 borrowed you get charged $1 for every 1% of interest per day. Please note never pay your credit cards in full because the credit cards will charge you a fee of $50 if you do so. Always pay at least $5.00 then the full balance. Also please not the higher the interest rate the more rewards the card offers and in most if not all casr=es the rewards wiill be much higher than the interest. The card companies make their money by you using the card off the mercahnct. so they give huge rewards if you carry over a balance, This is one secret the card companies do not tell you. Also usually pays to pay the minimum due less $5.00 as the credit cards then know you are not one who soon will pay your balance in full. If you do this they will in most cases give you a $45.00 gift on your next statement to be spent as you please. Please note that interest is good to pay but never accept interest as this almost always triggers an IRS audit and causes more grief then it is worth. When you open up a cd at your local bank or credit union just tell them to keep the interest all you care about is that they give you your principal at maturity. Hopefully I have been of help to you. Good luck  

Answer 2

Check out bankrate.com for current interest rates.

Answer 3

It's the percentage amount of the money they lend you that you pay each year for the loan.

Let's say you borrow $1000 and your interest rate is 18% (typical credit card rate). That means you will pay 18% of that $1000 over the year, or 1.5% a month. So, your account balance the first month will be $1015.

Let's say you pay $100 that month. Your new balance will be $915 plus 1.5% interest on that balance, or $13.73. So, your balance for the second month will be $828.73.

Again, you pay $100 in the third month. So, your balance is $728.73 + 1.5% ($10.93) = $739.66.

So, you have paid $300 over the first three months toward that original balance of $1000. But, you paid $39.66 of that in interest charges (what the lender charged you to borrow the money).