£52k into Icesave-monthly or annual interest?

egg345

Sorry, unsure what all this AER stuff really means....

House equity money, renting at mo....We've put 3k each into NSandI ISAs and are going to open 2 more in April.
At the minute we have 52k left to put into Icesave (5.7% yes?) but need to take 6k out in April to open the next ISAs.
May need another 1 or 2 k of it this year too.

Is this the right account for us?

Thanks!!

egg345

sorry, forgot to put if interest is added monthly its 5.56% and the AER is the same as annually at 5.7%-just dont know why you'd have the option if its the same???

Madiba_2

Its the same if you leave the monthly interest in the account, as you get interest on the interest, which makes it the same as having it all at the end of the year.

The difference is, of course, that you can spend the interest every month, if you really wanted to. Although with IceSave, you can withdraw whenever you like, so you could just spend the capital.

The main thing with the monthly interest is that you can have it paid to the nominated account, so you just leave the capital in the savings account to wither away to nothing after several decades, whilst you "live" off the interest.