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Halifax Childs Account
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dora37
Posts: 1,291 Forumite
Hi,
I have been looking at Martins advise for a childrens account and am very interested in the Halifax account
Halifax allows variable deposits of £10-£100 each month, meaning the most you can pay in is £1200 a year; but as it only lasts a year, the average balance you can have in is £600. Not such a huge sum, but it still pays better than elsewhere.
What I don't understand is - if the account can be held for 12 months with a max deposit if £100 - why would the balance be only £600? I don't know if I've misread it - but I just don't get it!
Can anyone make the penny drop with me?
I have been looking at Martins advise for a childrens account and am very interested in the Halifax account
Halifax allows variable deposits of £10-£100 each month, meaning the most you can pay in is £1200 a year; but as it only lasts a year, the average balance you can have in is £600. Not such a huge sum, but it still pays better than elsewhere.
What I don't understand is - if the account can be held for 12 months with a max deposit if £100 - why would the balance be only £600? I don't know if I've misread it - but I just don't get it!
Can anyone make the penny drop with me?
0
Comments
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It means the average balance over the year will be £600. This is only stated in order to calculate roughly how much interest will be earned in the 12 months.
At the end of the 12 months you will have £1200 plus the interest which will be approx 10% * 600 = £60.
(Edit: forgot to mention I also have one of these and if you have less than £100 per month to save it is an unbeatable rate)0 -
The £100 put in in month 1 is in for 12 months
The £100 put in in month 2 is in for 11 Months
"
"
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The £100 put in in month 11 is in for 2 months
The £100 put in in month 12 is ion for 1 month
So altogether
You have £100 earning interest for 78 months ( 1 + 2 + 3 + + + + 11 + 12 = 78 )
This is rather like having £1200 in for 6.5 months.
Interest approx £65 maximum...............................I have put my clock back....... Kcolc ym0 -
dora37 wrote:What I don't understand is - if the account can be held for 12 months with a max deposit if £100 - why would the balance be only £600? I don't know if I've misread it - but I just don't get it!
As (assuming maximum monthly deposits) the balance grows gradually from £0 at start to £1200 at the end the average balance during 12-months is about (£0+£1200)/2=£600. In fact it is £650 - see Regular Savings Accounts discussion.0 -
It is not the balance that is £600
The final balance is £1200 + the interest.
The interest is similar to what you would get by having £650 at the same interest rate for 12 months.
Halifax usually has other conditions which make the interest earned slightly less................................I have put my clock back....... Kcolc ym0 -
R00STER00 wrote:It means the average balance over the year will be £600. This is only stated in order to calculate roughly how much interest will be earned in the 12 months.
At the end of the 12 months you will have £1200 plus the interest which will be approx 10% * 600 = £60.
(Edit: forgot to mention I also have one of these and if you have less than £100 per month to save it is an unbeatable rate)
Ok it's Friday!! I get it now - AVERAGE AVERAGE AVERAGE0 -
The average balance over the year is actually £650.00...............................I have put my clock back....... Kcolc ym0
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