Annual interest savings accounts - Payments on account closure

cuthbei

Hi,

I'm looking to open a number of instant access savings accounts to spread some money around. A lot of the top paying accounts seem to pay interest annually rather than monthly. I'm wondering if anyone has experience of closing an account paying interest annually mid term?

I.e. If I want my money (to buy a house), will I get my annual interest because I have closed the account or will I have to wait until the interest due date? Would my account sit with a zero balance for a few months until the interest is due.

The T&Cs on the accounts are not explicitly clear in this area. I'm sure it will vary per account, but I'm wondering what people's general experience is. I think I'll have to wait until the due date, but that is only a guess.

Thanks, Cuthbei

Lokolo

If you close an account any interest gained from the last interest payment or opening from the account to the date of closure will be paid on closure.

If you close the account after 6 months you get 6 months worth of interest.

Reaper

Interest is calculated daily and when you close your account you will be paid up to that day, so you won't lose out.

That's true for all instant access accounts and it makes no difference whether it normally pays interest monthly or yearly.

EDIT: Beaten to it

cuthbei

Great, thanks.

rb10

What Lokolo and Reaper have said is true in 99.9% of cases, but there are some exceptions, so you have to watch the T&Cs of the account.

For example, Nationwide's e-Savings Plus, which pays a lower rate of interest if you close the account (although in this case you can work around that by withdrawing all except £1, as long as you have a penalty-free withdrawal free). But in nearly every case they won't penalise you for closing early and you'll get full interest paid up until the date you close the account.

Lokolo

rb10 wrote: »

For example, Nationwide's e-Savings Plus, which pays a lower rate of interest if you close the account (although in this case you can work around that by withdrawing all except £1, as long as you have a penalty-free withdrawal free). .

Really? Thats well harsh!!!!