Confused over 10% Halifax childs regular savings

deefadog

Hi all, i have had this halifax regular saver for my daughter for 4 years now (matures every march). Now i was told by Halifax that as i opened on the 10% interest then this would continue. We have put aside £100 per month (maximum amount).

Now i just checked the online account and for the last 2 years we have saved:

April 07 - March 08 - £1255.07 - interest - £55.07


April 08 - March 09 - £1196.07 - interest - £55.31

Now that is not 10%

Can anyone shed some light on this please before i call them, incase i have things wrong?

Many thanks

Aegis

deefadog wrote: »

Hi all, i have had this halifax regular saver for my daughter for 4 years now (matures every march). Now i was told by Halifax that as i opened on the 10% interest then this would continue. We have put aside £100 per month (maximum amount).

Now i just checked the online account and for the last 2 years we have saved:

April 07 - March 08 - £1255.07 - interest - £55.07


April 08 - March 09 - £1196.07 - interest - £55.31

Now that is not 10%

Can anyone shed some light on this please before i call them, incase i have things wrong?

Many thanks

You get 10% on the amounts that you have put in for a year, you get 11/12 of 10% on the amount you've put in for 11 months, etc.

In total you end up with about 6.5/12 of the total interest rate when going for regular savings, so a little over 5% for a 10% regular saver.

Hope this helps.

rb10

Interest is calculated daily, on the balance in the account on that particular day. So for the first month you earn interest on £100, for the second month you earn interest on £200, and so on, up until the final month, where you earn interest on £1200.

Obviously they aren't going to pay you interest on the full £1200, when they don't have that much from you for most of the year.

The amount that they have paid you is correct, and is a lot better than you'd have been able to get anywhere else.

withnell

I guess you meant that the interest for later years is lower - that's because the rate is fixed at the rate the first payment of the 12 goes in, so in effect you've started a new regular saver at a new rate fixed for 1 year each April

opinions4u

deefadog wrote: »

Hi all, i have had this halifax regular saver for my daughter for 4 years now (matures every march). Now i was told by Halifax that as i opened on the 10% interest then this would continue. We have put aside £100 per month (maximum amount).

Now i just checked the online account and for the last 2 years we have saved:

April 07 - March 08 - £1255.07 - interest - £55.07


April 08 - March 09 - £1196.07 - interest - £55.31

Now that is not 10%

Can anyone shed some light on this please before i call them, incase i have things wrong?

Many thanks

It's as others have posted.

Here's a link to a caluclator to help.

http://www.moneysavingexpert.com/savings/best-regular-savings-accounts#calculator

Basically the bank pays you the great rate while the money is in the account.

On a different matter, have you registered the accounts for gross interest, assuming they qualify?

deefadog

Thanks all. makes more sense now, i do remember this, but over the years i have been swapping my own accounts around so forgot the info on this!

And yes, it's gross!

Thanks you all again, very helpfull!

sloughflint

deefadog wrote: »

Hi all, i have had this halifax regular saver for my daughter for 4 years now (matures every march). Now i was told by Halifax that as i opened on the 10% interest then this would continue. We have put aside £100 per month (maximum amount).

Now i just checked the online account and for the last 2 years we have saved:

April 07 - March 08 - £1255.07 - interest - £55.07


April 08 - March 09 - £1196.07 - interest - £55.31

Now that is not 10%

Can anyone shed some light on this please before i call them, incase i have things wrong?

Many thanks

I agree with the comments regarding a diluted 10% but the only thing I'd query is the bit in bold.

You say you put in £100 per month and got interest of £55.31. Shouldn't the balance be £1255.31 in similar fashion to your line above it rather than £1196.07?
Did you pay less than £100 ever?

In fact even the first interest is odd: 6.5/12*0.1*1200= £65 gross. ( presumably tax free for children?)

deefadog

Hi, yes i did do uneven amounts because the money comes in from the child benefits (or what ever the £20 a week scheme is) i make this up to £100, but as they increase i have to amend my DD and sometimes i paid to early.

I can copy and paste the statements if that helps?

sloughflint

deefadog wrote: »

I can copy and paste the statements if that helps?

If you'd like to know for definite then yes sure go ahead.

Dates, amounts, and date interest was paid would be needed