vania-janet/multiturn-rag-retrieval-data huggingface dataset:
Simply put, for a mortgage, interest is charged only on the balance as well. Think of it this way - on a $100K 6% loan, on day one, 1/2% is $500, and the payment is just under $600, so barely $100 goes to principal. But the last payment of $600 is nearly all principal.  By the way, you are welcome to make extra principal payments along with the payment due each month. An extra $244 in this example, paid each and every month, will drop the term to just 15 years. Think about that, 40% higher payment, all attacking the principal, and you cut the term by 1/2 the time.
Two parties will agree to pay each other's interest obligations. This is generally for one of two reasons:   * One party wishes to swap a fixed interest rate (eg coupons on a bond) for a floating interest rate (eg: payments on a loan). If their counterparty wishes the opposite, and the rates are acceptable to both, they will agree to swap their obligations  * There are two firms, based in countries A and B. Each firm has a branch in the other's country, and these branches each have a loan, denominated in that other countries currency. To reduce each firm's exposure to FX risk, they can swap their obligations, so A will pay interest on B's loan (which is in A's currency) and B on A's loan (which is in B's currency).  edit: removed infuriating unterminated bracket.
"You are not wrong - just about anything can be charged and paid off in 30 days with a sale of non-liquid investments.  So there are not any emergencies I can think of that require completely liquid funds (cash). For me, the risks are more behavioral than financial: I'm not saying it's a ridiculous, stupid idea, and these are all ""what-if""s that can be countered with discipline and wise decisions, but having an emergency fund in cash certainly makes all of this simpler and reduces risk. If you have investments that you would have no hesitation liquidating to cover an emergency, then you can make it work.  For most people, the choice is either paying cash, or charging it without having investment funds to pay it off, and they're back in the cycle of paying minimum payments for months and drowning in debt."
By contract, that stock is yours if you pay for it (or, in a put, you can sell whenever you decide). In some cases, this may make sense (if you want an immediate payoff or you expect this is the best price situation), but you may prefer to watch the price. If the price moves further, your gain when you use the call may be even better. If the price goes back out of the money, then you benefited from an implicit put. It's as though you exercised the option when it went in the money, then sold the stock and got back your cash when the stock went out of the money, even though no actual transaction took place and this is all just implicit. So the time value of an American option includes the implicit option to not use it early. The value of the implicit option also decreases in a nonlinear fashion, since the value of the implicit option is subject to the same valuation principles. But the larger principle for both is the compounded volatility, which drops geometrically."
"Tricky question.  Many car leasing companies like to quote payments by the week or twice a month to make the car sound cheaper to carry.  If the lease or loan is calculated such that interest accrues monthly ""not in advance"" then any payments made prior to the date on which the interest is calculated will reduce the balance and therefore the interest. However, many loans and leases are calculated at the beginning for the whole life of the agreement.  In that case, splitting each payment in half doesn't do anything to reduce the interest built in to the payments because the interest is calculated ""in advance"""
The answer to this question is very different depending on the type of item.  From a purely financial perspective you would want to answer these questions which you may not have enough information to answer: Realistically the question I prefer to ask are: When something fails there is a big difference to me between having the cash and having an insurance policy that is suppose to cover it even if they are theoretically the same value.  Some insurance policies may even be better than cash, like homeowners insurance might help take care of details like finding a contractor to fix the issue, finding temporary housing if your house burns down, etc.
"Pay off the highest rate debt. Interest on both are charged on the balance owed, nothing more complicated than that. There are those who would call a mortgage ""front loaded"" but that's nonsense. Of course most of the payment is interest at the beginning because the debt is higher and you start with a 30 year term. The fastest way to pay off multiple debts is always from highest rate first and then the next and so on."
This depends in part on the bank holding your loan and the loan agreement.  Some loans will accept partial payments and apply them immediately; some will not accept partial payments at all, and some will accept the payment but hold the funds until the payment is at least your complete payment.  You should check your loan agreement to find out how the payment will be processed, as well as how it will be applied. It also is relevant how interest is calculated and accrued; if your interest is a daily rate, then you may save some money this way, but if it's a monthly rate then you wouldn't necessarily.  Either way you wouldn't really save very much money; in your particular case you'd be saving $0.15 per month (.025/24 = .001 semimonthly interest rate, $150 paid halfway through the month means you pay .001*150 less interest).  Is that $0.15 worth it?  Up to you I guess.  If you're paying that for 5 year loan, you'll end up ahead $9 at the end of it. Finally, there is a kind of program often offered to new mortgage holders where you pay every two weeks (like your paycheck) and thus 'pay down your mortgage faster by saving on interest', which is true, but it's because you make 26 half payments per year instead of 12 full (or 24 half) payments, not primarily because of particular savings on interest due to timing (and of course the program offerer has to make money somewhere!).  Paying an extra 8.33% each year is certainly a good way to pay off your loan faster, but it's not primarily due to the frequency of those payments.
If you were to put $100 in a 2% one-year CD, you'd get back $102 at the end of the year. Put the same amount in a 5% one-year CD, and you get back $105. So yes, higher interest rates means more interest money paid, for loans as well as deposits. Keep in mind that loans and deposits really are essentially the same thing, and interest calculations work the same way for both. The interest rate of a normal certificate of deposit does not change if the variable interest rates change, but rather is locked in when the money is deposited (or the CD is bought, whichever way you prefer to look at it).
If I recall correctly, the pay schedule is such that you initially pay mostly interest.  As James Roth suggests, look at the terms of the loan, specifically the payment schedule.  It should detail how much is being applied to interest and how much to the actual balance.
"never carry a balance on a credit card. there is almost always a cheaper way to borrow money. the exception to that rule is when you are offered a 0% promotion on a credit card, but even then watch out for cash advance fees and how payments are applied (typically to promotional balances first). paying interest on daily spending is a bad idea. generally, the only time you should pay interest is on a home loan, car loan or education loan.  basically that's because those loans can either allow you to reduce an expense (e.g. apartment rent, taxi fair), or increase your income (by getting a better job). you can try to make an argument about the utility of a dollar, but all sophistry aside you are better off investing than borrowing under normal circumstances. that said, using a credit card (with no annual fee) can build credit for a future car or home loan. the biggest advantage of a credit card is cash back. if you have good credit you can get a credit card that offers at least 1% cash back on every purchase.  if you don't have good credit, using a credit card with no annual fee can be a good way to build credit until you can get approved for a 2% card (e.g. citi double cash). additionally, technically, you can get close to 10% cash back by chasing sign up bonuses. however, that requires applying for new cards frequently and keeping track of minimum spend etc. credit cards also protect you from fraud. if someone uses your debit card number, you can be short on cash until your bank fixes it.  but if someone uses your credit card number, you can simply dispute the charge when you get the bill. you don't have to worry about how to make rent after an unexpected 2k$ charge. side note: it is a common mis-conception that credit card issuers only make money from cardholder interest and fees. card issuers make a lot of revenue from ""interchange fees"" paid by merchants every time you use your card. some issuers (e.g. amex) make a majority of their revenue from merchants."
"There's a significant difference between ""discount"" and ""surcharge"". For starters - legal difference. If you have a list price of $X - that's the price you're committed to sell regardless of the payment method. So it doesn't matter if I pay with cash or credit - I'll pay $X. However, it costs you more when I pay with credit - so you want to pass that cost on me. You charge me surcharge - an addition to the price. In some States in the US and in some other countries - that is against the law. You cannot add on top of the listed price any amount regardless of the payment method. However, you can say that the list price is $X, which includes the assumed credit card surcharge of $Y. And then you give discount of $Y to anyone not paying with credit card. The list price is still $X, regardless of the payment method. You don't have to give the discount, the discount is your cost of doing business. But that would be legal in some places (not all!) that forbid credit card surcharge. So the main difference from legal perspective is that you're not allowed to add to the list price, but you're allowed to discount from it. Regarding taxes - exemption/deduction is not a penalty for negative. Exemption/deduction is an implementation of a social policy. For example, it is for the public benefit for everyone to own a house. So the Congress comes up with a deduction of mortgage interest. However, you're not penalized if you don't own a house by paying higher taxes. Your tax rate doesn't change. You just don't get to deduct something that you might be able to deduct had you owned a house with a mortgage. This is, again - a discount of a list price, not a surcharge. You're not penalized if you don't have a house or don't have a mortgage, but if you do - you get a break. The author you're quoting claims that bottom line would be the same as if you considered the absence of a deduction as a penalty.
"Regarding ""Interest on idle cash"",  brokerage firms must maintain a segregated account on the brokerage firm's books to make sure that the client's money and the firm's money is not intermingled, and clients funds are not used for operational purposes. Source.   Thus, brokerage firms do not earn interest on cash that is held unused in client accounts. Regarding ""Exchanges pay firm for liquidity"", I am not aware of any circumstances under which an exchange will pay a brokerage any such fee.  In fact, the opposite is the case.  Exchanges charge participants to transact business. See : How the NYSE makes money Similarly, market makers do not pay a broker to transact business on their behalf.  They charge the broker a commission just like the broker charges their client a commission.  Of course, a large broker may also be acting as market maker or deal directly with the exchange, in which case no such commission will be incurred by the broker.  In any case, the broker will pay a commission to the clearing house."
If you took a fixed loan, but paid it off at the accelerated rate, you would ultimately pay less total dollars in interest. So compare the actual amount paid in interest over the course of the loan rather than the interest rate itself.  That should be your answer. Also, plan on failing in your plan to pay it off and see how that will affect you.
"Sure, stocks don't pay interest. I just looked up the word ""compound"" in a couple of dictionaries and the relevant definition in all of them just mentioned interest and not growth in the value of stock. So it may be technically inaccurate to talk about ""compound growth"" of a stock. I'll yield to someone more knowledgeable about the technical language of finance to answer that part. But regardless of whether the word strictly applies, the concept certainly does. Suppose you put $1000 into a mutual fund and the fund grows by 10%. You now have $1100. The next year the fund grows by 15%. So you gain 15% of what? Of your original $1000? No, of your present balance, $1100. The effect is the same as compound interest. There is the fundamental difference that interest is normally a fixed rate: you get such-and-such percent a year as spelled out in a contract. But change in the value of a stock depends on many factors, none of them guaranteed."
All of us require exact same time loan products. Cash is actually limited nowadays. Employment market and also the overall economy most importantly will be featuring people countless economical battles. Simply no consider this numerous among us are applying same exact daytime finances to aid via the remaining portion of the thirty days ahead of the future salaryday happens. ame daytime finances are made to assist people to who also you do not have the administrative centre to their rear , nor have got various other types of credit rating.
does that mean that 30% of my monthly payment goes to interest? No, it's much worse then that. The APR is the annual percentage rate. An APR of 30% on $23,000 in debt that means you'll be charged $6,900 in interest for the year. You'll actually owe slightly less since you are reducing your principal slightly over the course of the year. If your monthly payment is $800, $575 of that will be going to interest. That means that over 70% of your monthly payment is going just to interest. This deal makes no sense at all! You'd be better off simply transferring all of your balances on to the credit card with the highest interest rate. You'd be paying almost $200 a month for the 'convenience' of writing one check rather than three.
"The short answer is ""No"". There a 2 ways to get cash from a life insurance policy.  If the policy has cash value greater than the surrender value, then the difference can be borrowed, but will generally increase premiums in the future.   The other method, available on many term policies allows the owner to receive part of the death benefit if the insured has a physician willing to certify that he/she will probably pass away within a 12 month period.  Several carriers also offer cash benefits for critical care."
The only time borrowing instead of paying from cash would make sense is if you have (or think you might run into) opportunities to put that cash to work for you earning more than the interest you're paying. For instance, you might run into investment opportunities where having the cash to jump in would let you get into them.   Beyond something like this, it'd be foolish to pay interest just so you can have a bigger bank balance and feel like you're somehow better off! I hope this helps. Good luck!
"Let's say, I have a Life Insurance for 20 years. Whether the money will be given back to the Policy Holder along with the Accumulated Interest on it ? This depends on the type of Insurance Policy.  If you have purchased a ""Term Plan/Policy"" then these do not give back anything. However the premium is very low and is essentially covering for the risk. If you have ""Cash Value type"" of policies [Whole Life, Endowment, Universal Life, etc] then you get something back at the end. This depends on the policy document. The premiums are substantially high. It is generally advised that Cash Value type of policies are not good and the returns they generate are poor than depositing the difference in premium in alternative investments and buying a Term Plan."
"TL;DR summary: 0% balance transfer offers and ""free checks usable anywhere""   rarely are a good deal for the customer. 0% rate balance transfer offers (and the checks usable anywhere including payment of taxes) come with a transaction fee because the credit card company is paying off the balance on the other card (or the tax or the electric bill) in the full amount of $X as stated on the other card statement or on the tax/electric bill). This is in contrast to a purchase transaction where if you buy something for $X, you pay the card company $X but the card company pays the merchant something less than $X$. (Of course, the merchant has jacked up the sale price of the item to pass on the charge to you.) Can you get the credit card company to waive the transaction fee? You can try asking them but it is unlikely that you will succeed if your credit score is good! I have seen balance transfer offers with no transaction fees made to people who have don't have good credit scores and are used to carrying a balance  on their credit cards. I assume that the company making the offer knows that it will make up the transaction fee from future interest payments. A few other points to keep in mind with respect to using a 0% balance transfer offer to pay off a student loan (or anything else for that matter):"
It's calculated from the day you take it to the day it's paid in full, and as Dilip noted, there's usually a fee of a percent or two for cash advance.  Given the situation, the new job and need for cash, I'm not so worried about a few hundred dollars interest, nor the very short term minor ding on your credit. Credit scores have components that are long term, such as missed payments, and those that are nearly real time, like utilization.
The first thing you need to do is look at your terms and conditions of your credit card, or ask your bank, how they will apply the payments.  As Dilip notes in his answer, in the US, they will likely apply the minimum payment to the lower rate balance, and then must apply the rest above the minimum to the higher rate balance.  In other countries, this will vary by law and custom.  Do not assume it will pay off the higher balance, or proportionally, without asking. Let's take the following example. You owe $6000.  $5000 is at 13.5% (normal purchase rate) and $1000 is at 22% (cash advance rate).  If your bank applies payments to both balances proportionally, then a payment of $600 will reduce your purchase balance by $500 and your cash advance balance by $100. The average APR, then, is simply sum of the product of the APR times balance.  So here, (.135*5000 + .225*1000)/6000 = 15%.  This is called a weighted average. If the bank applies the payment differently - such as to the lower rate first, or some specified part to the lower rate and the rest to the higher rate - then this will be misleading if you enter it into a calculator, because your average APR will rise over time as you pay off the purchase balance but don't pay off the cash advance balance, or may decrease if the opposite happens. The weighted average is probably reasonably close in the circumstance that you describe, even if you have rules applying the balance differently, so long as they don't 100% pay down the lower rate - so it may be the simplest option for you in terms of rough calculations (where it's not critical to be correct, just close). One approach using the online calculators that might be better, is to treat these like two separate loans/cards.  Many calculators exist for multiple balances.  Then you can allocate funds differently to the two 'cards'.  This would allow you to see how long you will need until you've paid off the higher balance, for example, although it probably won't perfectly match things - unless you find a site that has this specific option available you probably will have to either live with a small error in your calculations or do the math by hand.
"No. That's pretty unlikely. Card issuers typically base your rate on your credit score. Paying down debt reduces your percent of available credit used, and improves your score until you are in the 1-20% range. That's optimum. To this issuer, you are one of a million customers, there's no emotion in this, just numbers to them. For what it's worth, if a card issuer raises your rate, you are permitted to ""not accept"" the rate, stop using the card for new charges, and pay at the current rate. Of course this doesn't apply to zero interest deals, only to increases to your regular rate."
If we're including psychological considerations, then the question becomes much more complicated: will having a higher available credit increase the temptation to spend? Will eliminating 100% of a small debt provide more positive reinforcement than paying off 15% of a larger debt? Etc. If we're looking at the pure financial impact, the question is simpler. The only advantage I see to prioritizing the lower interest card is the float: when you buy something on a credit card, interest is often calculated for that purchase starting at the beginning of the next billing cycle, rather than immediately from the purchase date. I'm not clear on what policies credit card companies have on giving float for credit cards with a carried balance, so you should look into what your card's policy is.  Other than than, paying off the higher interest rate card is better than paying off the lower interest rate. On top of that, you should look into whether you qualify for any of the following options (presented from best to worst):
Gundlach shared a chart that showed how investors in European “junk” bonds are willing to accept the same no-default return as they are for U.S. Treasury bonds. In other words, the yield on European “junk” bonds is about the same—between 2 percent and 3 percent—as the yield on U.S. Treasuries, even though the risk profile of the two could not be more different.  Sounds like a strong indicator to me. How might this play out in the US?
No, the stock market and investing in general is not a zero sum game.  Some types of trades are zero sum because of the nature of the trade.   But someone isn't necessarily losing when you gain in the sale of a stock or other security. I'm not going to type out a technical thesis for your question.  But the main failure of the idea that investing is zero sum is the fact the a company does not participate in the transacting of its stock in the secondary market nor does it set the price. This is materially different from the trading of options contracts.  Options contracts are the trading of risk, one side of the contract wins and one side of the contract loses. If you want to run down the economic theory that if Jenny bought her shares from Bob someone else is missing out on Jenny's money you're free to do that.  But that would mean that literally every transaction in the entire economy is part of a zero sum game (and really misses the definition of zero sum game). Poker is a zero sum game.  All players bet in to the game in equal amounts, one player takes all the money.  And hell, I've played poker and lost but still sometimes feel that received value in the form of entertainment.
I could be mistaken on this, but after the GM bailout and others, weren't laws put in place to essentially force companies to maintain a certain level of liquidity? Also, that 0% is probably closer to .25~.50 through way of credit swaps, no? Or if we assume it's earning .1%, that's still $6,666,667/month ($80,000,000,000 x .001/12).