One of the first ways many children start earning money on their own is from the interest earned off the money they have in their savings account. But the interest rate can make things very confusing. You gain a certain amount of interest off the money you have in your account, but the earned interest is based off daily balances, not your balance at the end of the year. And most banks calculate the interest monthly and pay it out. So while you're getting paid much less each month than the percentage of interest your savings account has, over the course of a year the percentage of money earned from your savings account in proportion to the average daily balance of your account will equal the percentage of interest.
Step 1
Determine how your interest is calculated. Most savings accounts calculate and disperse interest monthly, but yours may calculate and disperse daily.
Step 2
Find out the interest rate your savings account has. Most are between 2 percent and 4 percent annual interest.
Step 3
Multiply the percentage by the amount of money you have in the account.
Step 4
Divide the resulting number by 12 if you get paid out every month, or 365 if you get paid out every day. The number you end up with is the amount of interest you will earn every pay period.
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