Good news and bad news about the Post Office Growth Bond 7, and its Loyalty Bond Issu

sue_on_moneysavingexpert

Good news and bad news about the Post Office Growth Bond 7, and its Loyalty Bond Issue 2:

The Good News:

The Post Office Savings people told me on the phone this morning that I would be paid the full 7.05% interest on the funds that they held between my cheque clearing on 18/8/08 and them finally opening my Post Office Growth Bond 7 on 30/9/08. This latter date is what they have given as the maturity date.

However, the maturity value they quoted didn't include it (the interest added was exactly 80% of 7.05% - ie 12 months of interest with 20% tax deducted). They did make it sound as though this would be standard for all, but their automated system wasn't able to cope with it...

The Bad News:

I was also considering taking up their offer to transfer more funds to the new Loyalty Bond 2 at 4%, until I asked what happened to my funds whilst they waited for my first Bond to mature, and was told that it would sit in a holding account at 0.1% until then. This means that if they hold my funds for 5 weeks, that is equivalent to an interest rate of only 3.649%, or for 6 weeks only 3.586%!!!!

SO WATCH OUT – THEIR RATES MAY SEEM COMPETITIVE, BUT BY THE TIME THEY HAVE SAT ON YOUR FUNDS FOR 5-6 WEEKS, THEY’RE NOT!!!!!!

(Calculated as 4% minus 5/57 of 4%, or 4% -minus 6/58 of 4%)

MartyMcfly_3

sue_on_moneysavingexpert wrote: »

Good news and bad news about the Post Office Growth Bond 7, and its Loyalty Bond Issue 2:

The Good News:

The Post Office Savings people told me on the phone this morning that I would be paid the full 7.05% interest on the funds that they held between my cheque clearing on 18/8/08 and them finally opening my Post Office Growth Bond 7 on 30/9/08. This latter date is what they have given as the maturity date.

However, the maturity value they quoted didn't include it (the interest added was exactly 80% of 7.05% - ie 12 months of interest with 20% tax deducted). They did make it sound as though this would be standard for all, but their automated system wasn't able to cope with it...

The Bad News:

I was also considering taking up their offer to transfer more funds to the new Loyalty Bond 2 at 4%, until I asked what happened to my funds whilst they waited for my first Bond to mature, and was told that it would sit in a holding account at 0.1% until then. This means that if they hold my funds for 5 weeks, that is equivalent to an interest rate of only 3.649%, or for 6 weeks only 3.586%!!!!

SO WATCH OUT – THEIR RATES MAY SEEM COMPETITIVE, BUT BY THE TIME THEY HAVE SAT ON YOUR FUNDS FOR 5-6 WEEKS, THEY’RE NOT!!!!!!

(Calculated as 4% minus 5/57 of 4%, or 4% -minus 6/58 of 4%)

i believe your talking about issue 6a growth bond and not an issue 7 growth bond (which came out in october 2008) i just thought i correct that incase it is different for issue 7 (unless im wrong)

malik999

It appears its all bad news for me since i didnt have a cheque between 18/8/08 and 30/9/08 or any other dates for that matter.