Barclays Monthley Saver...

sheedatali

I recently opened an account with Barclay (Monthly Saver), which allows me to deposit upto 250£ per month. MSE article recommended this account. At the time of opening the account and still Barclay website says 6% interest for this account. As the calender month rolled over, I can see that they have paid interest on 250£ pounds, however the interest paid is 0.48£. I could be totally wrong, but % of 250 is 15£, I do not understand why they have paid only 0.48£. If the interest paid is annually only then why have they paid any interest at all. I am confused, could someone please explain if this this normal?

Wookey

Will depend at what point in the month you opened the account and when they calculate its interest on funds within it. You won't however receive £15.00, the interest is worked out at 6% over the course of one year, you receive 6% / 1/12th which is approx £1.25 less tax at 20% which should bring it down to approx £1. As the funds in the account grow then so will the interest.

droopsnoot

I have one of these, and I forget the exact Ts and Cs. One previous Barclays regular saver account paid basic interest, then a bonus at the end of the year if you didn't withdraw or break any of the other terms, so at the end of the twelve months you've had the equivalent of the 6%.

rooroo659

I just got a printed out statement from Barclays. Can someone who is capable of these kind of things please check if the interest works out at 6% or 7.75%? I applied on 31Dec08 (as advised by this website) and so think I should be getting the 7.75% AER. T&Cs don't mention anything about paying a standard rate then a bonus (as the poster above suggests) - if conditions are met (no withdrawals) the equivalent of 7.75% AER should be paid monthly

07/01/09 100.00 deposit (deposited on 31Dec08)
23/01/09 250.00 paid by standing order
02/02/09 0.66 int
23/02/09 250.00 paid by standing order
02/03/09 1.48 int

Also does anyone know (maybe a Barclays staff member?) whether, if I change my standing order to the start of the month, I will incur a penalty?

Cheers guys.

SnowMan

At 6% (AER) estimated net interest is £0.65 (2/2/09) and £1.48 (2/3/09)
At 7.75% (AER) estimated net interest is £0.84 (2/2/09) and £1.90 (2/3/09)

So looks like you are getting 6%

Sorry for that icy news

To get the 7.75% rate the first payment needed to have CLEARED into the account by 31 December see http://forums.moneysavingexpert.com/showthread.html?t=1380583.

rooroo659

Thanks for the calculations SnowMan!

I followed the MSE advice and paid on 31Dec with a cheque, altho I was thinking at the time that it's not gonna clear in time! Seems like Martin made a booboo on this one...

Anyone know how much difference there'll be at the end of the term (one year) if I continue to pay £250 per month and get 6% as opposed to 7.75%? Depending on how much it is I might try and get Barclays to change it. But it wasn't them who said I could pay by cheque, it was Martin!

On another note I have about £2k in an egg ISA and have watched the rate plummet with the recent interest rate cuts. It's 2.05% today but another cut will surely come soon! I've stopped paying into it since I opened my Barclays Montly Saver. Am I correct in thinking I'm better off sticking all my future savings (£250 per month) into this Barclays account, whether it's 6% or 7.75%? Even after tax Barclays will still pay out more interest, right?

SnowMan

rooroo659 wrote: »

Anyone know how much difference there'll be at the end of the term (one year) if I continue to pay £250 per month and get 6% as opposed to 7.75%?

Difference is between receiving about £80 net interest (7.75%) in total or £62 net interest (6%) so about £18 for a basic rate tax payer.