How does an annual percentage yield work?

When considering a deposit account, you want something that not only suits your needs, but something that earns interest as well helping you grow your money.  Understanding how Annual Percentage Yields (APYs) work and using those APYs will help you decide the best savings, checking or investment account for you.

What is APY?

APY is the percentage of growth or rate of return you earn on an investment over a year. The APY grows exponentially through compound interest. As interest is earned, it’s added to the principal amount. The account balance will increase after each interest period. The higher the APY, the faster the funds grow.

The Federal Reserve sets a target range for rates from which banks may adjust their rates accordingly. Contact Adirondack Bank or visit for our current rates.

What is compound interest?

With compounding, interest is calculated on the initial deposit as well as on any interest already added to the balance. This is commonly thought of as “interest on interest.” Interest can be compounded at any schedule including daily, monthly or annually.

What is my APY?

Adirondack Bank can provide you with your APY. Visit or a Branch Banking Representative for details.

Watch your money grow

By understanding how Annual Percentage Yield works, you can easily calculate how your money can grow over time.

If you’re interested in opening an interest-bearing checking, savings or money market, visit or visit a Branch Banking Representative for more details.

The information is this article was obtained from various sources not associated with Adirondack Bank. While we believe it to be reliable and accurate, we do not warrant the accuracy or reliability of the information. Adirondack Bank is not responsible for, and does not endorse or approve, either implicitly or explicitly, the information provided or the content of any third-party sites that might be hyperlinked from this page. The information is not intended to replace manuals, instructions or information provided by a manufacturer or the advice of a qualified professional, or to affect coverage under any applicable insurance policy. These suggestions are not a complete list of every loss control measure. Adirondack Bank makes no guarantees of results from use of this information.

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