Lloyds TSB's 8% vs. Icesave's 5.45%

OMski

Thanks so much that

It gives me something to experiment with in terms of how much to invest and what account to choose.

I never thought of the % would return half back - Guess I have loads to learn

I really do appreciate this, thanks all

drunknmunky

yorkshireboy - you're a genius. think i finally understand it now.

one final question before I open an Icesave account. On the website, it states I can have interest either paid monthly or annually at the following rates...

Amount Deposited Gross Per Annum¹ paid Annually AER²
£250 - 1,000,000 5.45% 5.45%
Amount Deposited Gross Per Annum¹ paid Monthly AER²
£250 - 1,000,000 5.32% 5.45%

The AER is the same for both so is there anything I should take into consideration before choosing whether to go for Monthly or Annual interest payments?

Cypher

There isn't any difference really. The monthly shows a lower rate 5.32 instead of 5.45, as you gain interest on the interest. The AER is the annual rate for both showing they are the same after the 12 months


Personally I go for monthly, so I can see whats going on and see the benefits of saving each month.

shitefourbrains

Using the Lloyds TSB rates I worked out the interest you'd earn to be about £450 after two years after paying tax.

drunknmunky

that for working that out brains