Bradford and Bingley Interest rates
barryd999
Posts: 117 Forumite
Hi
My wife recently opened a Bradford and Bingley Internet Saver 2 account after seeing it on this site as one of the recommended esaver accounts. Her interest rate after tax should be 4.78% per month. On the £40000 she invested she calculated this to be £191 but her first full month of interest earned just £163. My wife calculated the interest by simply multipying 40000 x 4.78% to get £191. When she rang the bank they said the formula should be £40000 x 4.78 divided by 365 and then multiplied by the days in the month. This calculation does actually work out to £163 which is what they have paid.
Have we just been a bit thick with our calculations and is this the way all banks calculate interest or should we move to a better account?
My wife recently opened a Bradford and Bingley Internet Saver 2 account after seeing it on this site as one of the recommended esaver accounts. Her interest rate after tax should be 4.78% per month. On the £40000 she invested she calculated this to be £191 but her first full month of interest earned just £163. My wife calculated the interest by simply multipying 40000 x 4.78% to get £191. When she rang the bank they said the formula should be £40000 x 4.78 divided by 365 and then multiplied by the days in the month. This calculation does actually work out to £163 which is what they have paid.
Have we just been a bit thick with our calculations and is this the way all banks calculate interest or should we move to a better account?
0
Comments
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Her interest rate after tax should be 4.78% per month.On the £40,000 she invested she calculated this to be £191 but her first full month of interest earned just £163.
My wife calculated the interest by simply multiplying £40,000 x 4.78% to get £191.When she rang the bank they said the formula should be £40,000 x 4.78 divided by 365 and then multiplied by the days in the month.This calculation does actually work out to £163 which is what they have paid.Have we just been a bit thick with our calculationsand is this the way all banks calculate interest or should we move to a better account?
I would expect this to be specified somewhere in the account T&C (Terms & Conditions).Imprudent granting of credit is bound to prove just as ruinous to a bank as to any other merchant.
(Ludwig von Mises)0
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