Drip Feeding for regular savings

pedantical

Have I found an error in the calculations re interest in normal account used for drip-feeding? The higher interest in this account, the lower the total interest gained. The lower interest the more overall interest gained. I assumed using 4 building societies each offering around 3.05% and paying in £250 per month into each one. I tried the figures using 1% and 3% and £20000 as the commencing figure. If 3% is being obtained then very little advantage is to be gained from getting 3.05% elsewhere. It was suggested using the highest interest rate for the normal feeder account.

Hominu

You are not making the slightest amount of sense.

Do you want to try again?

grumbler

pedantical wrote: »

Have I found an error in the calculations re interest in normal account used for drip-feeding?

I don't think so.

The higher interest in this account, the lower the total interest gained.

You are mistaken unless it's higher than the interest you get on your regular savings.

The lower interest the more overall interest gained.

No.

I assumed using 4 building societies each offering around 3.05% and paying in £250 per month into each one.

I.e. simply 3.05% and £1000.

I tried the figures using 1% and 3% and £20000 as the commencing figure. If 3% is being obtained then very little advantage is to be gained from getting 3.05% elsewhere.

Hardly a surprise as you can't gain much by transferring from 3% to 3.05%. Best regular saving account pays 6%.

It was suggested using the highest interest rate for the normal feeder account.

Correct, but if you can get it the same or higher than for regular savings, there is no point in using regular savings.

opinions4u

I think this wins the most baffling post of the day award!