Typically how long does money have to sit in the bank to earn interest?

Question

I am researching a business idea. If I open an escrow account for a consulting business and I place clients money in the account can it earn interest and if so how much and how long does it have to be in the account before it earns the interest?

Answer 1

Money generally begins to accrue interest from the beginning of the day it is entered in the financial institution's system as an account. I know, because I created a spread sheet which tracks all my accounts, and they are generally accurate down to the penny starting from the beginning of the day I opened the account. Differentials between time zones though can affect start times.

Some institutions, the government, and some types of accounts will penalize the owner substantially if certain criteria aren't met, like meeting minimum deposit time lengths, or withdrawing money before one reaches a given age. Penalties can eat away substantially at accrued interest. The requirements of each institution are unique. Contact them by phone or look them up online. Most print all the information about their various accounts on their website.

Answer 2

Depends on the account you have opened, either monthly, quarterly and some, like c/d's are annually.