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  • FIRST POST
    • davidobee
    • By davidobee 5th Dec 17, 2:24 PM
    • 2Posts
    • 3Thanks
    davidobee
    Gross interest - help needed!
    • #1
    • 5th Dec 17, 2:24 PM
    Gross interest - help needed! 5th Dec 17 at 2:24 PM
    Dear All

    I am struggling to work out my interest for this year. The bank I am referring to is the Halifax help-to-buy ISA (given the increased interest rate).

    I have been paying £200 a month to this account since last year and have just been given this years interest.

    Based on the savings, I worked out the interest to be £198 (£5,679 x 0.035%).

    The interest received is £157.69 (GROSS).

    I am mystified as to why?

    If anybody is able to help me with my enquiry I would be very grateful.

    Kind regards

    David.
Page 1
    • Linton
    • By Linton 5th Dec 17, 2:41 PM
    • 8,622 Posts
    • 8,591 Thanks
    Linton
    • #2
    • 5th Dec 17, 2:41 PM
    • #2
    • 5th Dec 17, 2:41 PM
    Perhaps you havent taken into account the fact that £1200 out of your £2400 paid in this year was in the account for 6 months or less. You only get interest on the money actually in your account.
    • Economic
    • By Economic 5th Dec 17, 2:42 PM
    • 151 Posts
    • 98 Thanks
    Economic
    • #3
    • 5th Dec 17, 2:42 PM
    • #3
    • 5th Dec 17, 2:42 PM
    Is £5,679 your average balance or the balance at the end of the year? The £200 you paid in last month only gets one month of interest 3.5%/12=0.29%!
    • Zanderman
    • By Zanderman 5th Dec 17, 2:59 PM
    • 1,312 Posts
    • 3,742 Thanks
    Zanderman
    • #4
    • 5th Dec 17, 2:59 PM
    • #4
    • 5th Dec 17, 2:59 PM
    Dear All

    I am struggling to work out my interest for this year. The bank I am referring to is the Halifax help-to-buy ISA (given the increased interest rate).

    I have been paying £200 a month to this account since last year and have just been given this years interest.

    Based on the savings, I worked out the interest to be £198 (£5,679 x 0.035%).

    The interest received is £157.69 (GROSS).

    I am mystified as to why?
    Originally posted by davidobee
    You paid 2400 in over the year.. You had 3279 in already.

    3279 earns .035% which is 114.

    The 2400 also earns this but only the first 200 gets a year's worth of .035, the rest gets 11/12, 10/12, 9/12 and so on of .035. Actual interest earned on new money is about 43

    Total interest is therefore 157
    • davidobee
    • By davidobee 5th Dec 17, 6:23 PM
    • 2 Posts
    • 3 Thanks
    davidobee
    • #5
    • 5th Dec 17, 6:23 PM
    Fantastic responses
    • #5
    • 5th Dec 17, 6:23 PM
    This is my first post on moneysavingexpert.com and I can not fault the response rate. I am extremely grateful for your replies as it totally clears up my confusion!

    Thank you.

    Best wishes.

    David.
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