Do I Earn Interest in My Fidelity Cash Account?
Summary of User’s Concern and Solutions Discussed:
- The main problem reported by GirlyCathy is confusion about how interest is earned in her cash management account with Fidelity, specifically whether the interest is earned daily or annually.
- FidelityDexter clarified that interest is calculated daily but paid out monthly, and the provided rates are annual, meaning GirlyCathy would earn approximately $0.19 per month on a $100 balance at a 2.32% interest rate.
- FidelityEmilio explained that GirlyCathy’s observation of gaining small amounts daily could be from interest payments related to investments in her account. He suggested checking the “Activity & Orders” tab on the Fidelity website for a detailed account history.
Here’s the full thread
do you earn interest everyday with a cash management account on fidelity? Like if I put in $100 and the interest rate is 2.32%, would I get an additional $2.32 everyday?
Hello @GirlyCathy, sorry we missed you last night.
Money market interest is calculated daily and paid out monthly. The pay date is the first business day of each month.
The interest rates are provided are annual rates–meaning that is the rate you would receive if the interest rate stayed the same the whole year. In your example, you would get $2.32 for the year, not every day. You’d roughly receive $0.19 per month on $100 (2.32 divided by 12 months) at that rate.🟢
I’ve noticed I’ve been gaining a penny everyday in my cash management account and 2 yesterday. Is that normal, where is this coming from? 🙂
Happy to jump in here @GirlyCathy.
There are a number of reasons why you may be seeing these small amounts coming into your Cash Management Account. These are most likely interest payments from an investment in the account. You can view specific line items by clicking the “Activity & Orders” tab on our website, then view the account’s history. This should shed some light on where those amounts are coming from.🟢