<prompt> Human: So I have a Discover savings account with an APY of 1.80 and an interest rate of 1.78. I am not sure how often this is compounded as it says dailymonthly on the page I could find. The Interest paid transactions show up about on the last day of each month.I am not sure how exactly I got a 0.94 interest payment for the month of August.Here are some snapshots of this accounts balance:72518 2572718 100073118 Interest payment: 0.25 account balance at 1026 after81618 926.1782018126.1782718 283118 Interest payment: 0.95 account balance at 2.95I am very confused on when this interest payment is calculated. Is it a snapshot made at some point in the month or do they look at average balance over the month or have something fancier going on?Why did I get 95 cents of interest when I only had 2 in the account?I may just not understand the math behind all of this period as the math is not working out. Lets say I had 1k in here and it was at the interest rate of 1.78 I would assume that to mean I get 17.8 monthly adding up to 213.6 for the year. That is obviously not right as the APY says I should earn 18 for the full year. What is wrong with my math here?Assistant: Interest is calculated daily, and deposited monthly. As you are aware, the 1.8 is indeed annual, not monthly - if you have 1000, you get 18 per YEAR. Divide by 12 to get the monthly interest: 1.50month. For daily interest, you divide the rate by 365 - just under 5 cents per day. Human: What does it mean when it lists my interest rate as a number separate from my APY?  <response>: APR: What the rate says.APY: What you actually get or pay. For anything besides yearly interest calculations, APY is going to be higher than APR.The difference is that the more times the interest is calculated, the higher the APY will get.Eg: Assume you have a 1000 loan at a 10 APR. If the interest is calculated yearly, then the total amount of the loan will be 1000 1.1 1,100, as expected. 100 1000 means this is a 10 APY.If the interest is calculated half-yearly 10 2, or 5 per 6 months, then the total amount of the loan is not 1,100, it is 1000 1.05 1.05 1,102.50. 102.50 1,000 gives you an APY of 10.25.If the interest is calculated monthly 10 12 0.83 per month, then the total amount of the loan is 1000 1.0083 12 1,104.27, or an APY of 10.43.Daily would be 1000 1.000274 365 1,105.17, or an APY of 10.52.APY is the number you should care about. 