Monthly interest - First Direct best?

Bargain_Rzl

Hi all,

As my ISA is already full for this year, I'm looking for a new instant access savings account in which to put the rest of my savings towards my deposit on a flat (see my signature).

As I'm hoping to buy said flat in under a year from now, it's important to me to have an account which pays interest monthly, so it is physically in my account, helping to build towards my target, and is accessible whenever I want it rather than having to wait until the anniversary of the account opening date.

Am tempted by First Direct - the "no interest in month of any withdrawal" doesn't bother me because I wouldn't be making any withdrawals until such time as I access the whole balance as a lump sum. It would also be handy and easy to open/manage as I already have other accounts with FD. It is paying 4.75% interest at present.

Is there a better/higher-paying product out there with monthly interest?

TIA
Rzl

grumbler

Bargain_Rzl wrote:

As I'm hoping to buy said flat in under a year from now, it's important to me to have an account which pays interest monthly, so it is physically in my account, helping to build towards my target, and is accessible whenever I want it rather than having to wait until the anniversary of the account opening date.

If you close an account with interest paid annually, the interest is added on closure.

the "no interest in month of any withdrawal" doesn't bother me because I wouldn't be making any withdrawals until such time as I access the whole balance as a lump sum.

Let's say you need the lump sum at the end of the 10th calendar month (and cannot wait till the start of 11th). You lose about 1/10 of your total interest, i.e. 4.75% will become 4.275%. The shorter the period the higher the potential (relative) losses.

equitydealer

Bradford and Bingley pay 4.85% (monthly interest). And there are no restrictions on movement of cash, only condition is that you must have a min of £1000 in the account.

EagerLearner

ICICI are offering 5.03 / 5.15 AER I think, no penalties for withdrawing and my account opened in around a week - I had been using the First Direct E-savings as you mentioned, but hated being penalised for needing to withdraw.

EagerLearner

tomstickland

I use Icici too. High rate, no catches, monthly payment.