Alliance & Leicester 10% gross pa/AER

BigKisses

Does anybody know if there's a catch with this offer,other than having to open a current account too and not being able to touch the money for the full year(unless you close the account)?
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Premier Regular Saver

A great regular savings account when you open one of our Premier current accounts

• 
• Earn 10.00% gross p.a./AER† fixed for a year
• Save between £10 and £250 per month by regular transfer from a Premier Direct or Premier Current Account
• Interest paid on maturity

General Account Information

Withdrawal options

No withdrawals are permitted. If you need access to your money, the account must be closed

Minimum balance

£10

Maximum balance (over fixed 12 month period)

£3,000

Interest frequency

Annual - At the end of 12 months on the anniversary of the first payment.

Applicants age requirements

21 or over

Application options

Apply online or by phone as part of a new Premier Direct or Premier Current Account

http://www.alliance-leicester.co.uk/savings/index.asp?page=prem-regular-saver&ct=curracchome

grumbler

No catches. However, many people make a mistake expecting to get 10% gross on the full amount saved during 12 months (final balance). In fact you get 10% on something near the average balance during a year. For £250 p.m. savings average balance is about £1500. More correct formula is m*6.5/12, where m is monthly amount saved. See Regular Saver link in the blue box above and discussion.

YorkshireBoy

Not strictly a catch with the regular saver, but the current account has to be funded with a minimum £500 per month.

BigKisses

Cheers for that;)


So I'd be looking at around £135 in interest for he year on £250 a month?

YorkshireBoy

BigKisses wrote:

So I'd be looking at around £135 in interest for he year on £250 a month?

Using...

3,000 / 12 x 6.5 x 10% x 0.8

...you'd receive £130

You'd also make 5% AER (on balances up to £2.5K) on the money whilst it sat in the A&L current account waiting to be transferred each month.