A&L Regular Saver - Less interest than expected

houmie

Hi Everyone,

I have opened a year ago a premier direct account and premier Regular saver account with A&L.

I made 250 quid regular payment into the saving account and haven't missed any of them.

On June the 1st the account is going to muture and yet they sent me a letter with an estimated forecast of 3129.81.

My Account is registered as 8% interest rate. How is that supposed to be calculated, is that right?

Many thanks,
Houman

YorkshireBoy

3000 x 10% / 12 x 6.5 x 0.8 = £130 net interest.

RayWolfe

As YB said £ 129.81 is about right. What were you expecting? Not 8% of £3,000, I hope?
Why? 'Cause you didnt have £3K saved for a year.

YorkshireBoy

houmie wrote: »

How is that supposed to be calculated, is that right?

My earlier post used the " /12 x 6.5 " approximation. More accurately, your interest is calculated as follows:

Month.....No days...Open....Credit.....Close.......Int
.............in month...Bal....................Bal..........Accrued
Jun............30...........0......250........ 250.........2.05
Jul.............31........250......250........500.........4.25
Aug...........31........500.......250........750........6.37
Sep...........30........750.......250.......1000........8.22
Oct...........31.......1000.......250.......1250.......10.62
Nov...........30.......1250.......250.......1500.......12.33
Dec...........31.......1500.......250.......1750.......14.86
Jan............31.......1750......250........2000.......16.99
Feb...........28........2000......250.......2250........17.26
Mar...........31........2250......250.......2500........21.23
Apr...........30........2500......250........2750.......22.60
May..........31........2750......250........3000.......25.48
.................................................................

---

Total interest added at maturity.....................162.26
20% savings interest tax deducted...................32.45
.................................................................

---

Net interest..............................................129.81



Apologies for the poor formatting.

houmie

Many thanks YorkshireBoy. Now I understand how it works.