Regular Saver Actual (Not Headline) Interest Rate

ChopperST

I'm sure someone posted it before but I can't find it on the forum search.

Can someone advise of the formula to calculate the annualised interest rate of a regular saver.

The specific account I'm looking at is the First Direct Regular Saver @ 6% on contributions of £300 per month.

Thanks in anticipation.

Careful_ly

http://www.moneysavingexpert.com/savings/best-regular-savings-accounts
You need to scroll down the page to the bright orange box, that does the calculation for you.
HTH

YorkshireBoy

Gross interest is...

(12 x £300) x 6% / 12 x 6.5

kidmugsy

ChopperST wrote: »

Can someone advise of the formula to calculate the annualised interest rate of a regular saver.

Almost monthly, it seems, somebody has to explain that for regular saver accounts the Headline Interest Rate is the actual annualised interest rate. What you want isn't the annualised interest rate, it's the annual interest payment.

jimjames

ChopperST wrote: »

I'm sure someone posted it before but I can't find it on the forum search.

Can someone advise of the formula to calculate the annualised interest rate of a regular saver.

The specific account I'm looking at is the First Direct Regular Saver @ 6% on contributions of £300 per month.

Thanks in anticipation.

If the headline rate is 6% then that is what you will get on your savings. You only get paid on the money in your account though but everything in the account will be paid at 6% so that is the annual rate.

eskbanker

YorkshireBoy wrote: »

Gross interest is...

(12 x £300) x 6% / 12 x 6.5

Although slightly less accurate, I always mentally just halve the headline rate, on the basis that averaged over the period there will be roughly half the total sum earning interest. Yes, strictly speaking it's 6.5/12 not half, but close enough for those moments when there isn't a calculator to hand!

ChopperST

kidmugsy wrote: »

Almost monthly, it seems, somebody has to explain that for regular saver accounts the Headline Interest Rate is the actual annualised interest rate. What you want isn't the annualised interest rate, it's the annual interest payment.

My question was how to calculate the interest rate and the precise formula for doing so - nothing to do with the interest payment. But thanks for your reply, hope you feel better for that.

noh

ChopperST wrote: »

My question was how to calculate the interest rate and the precise formula for doing so - nothing to do with the interest payment. But thanks for your reply, hope you feel better for that.

The interest rate, as stated, on the FD regular saver is 6%
No calculation is required.

p00hsticks

ChopperST wrote: »

My question was how to calculate the interest rate and the precise formula for doing so - nothing to do with the interest payment. But thanks for your reply, hope you feel better for that.

????? As kidmugsy anf jimjames both point out, there is nothing to calculate. The annual interest rate is as it says on the tin - 6%.

Perhaps you mean the overall interest payment you get back at the end of the year expressed as a percentage of the total put in - but that's not the same as the interest rate.

CLAPTON

ChopperST wrote: »

My question was how to calculate the interest rate and the precise formula for doing so - nothing to do with the interest payment. But thanks for your reply, hope you feel better for that.

had a bad day?

ChopperST

CLAPTON wrote: »

had a bad day?

Good day thanks for asking Clapton. How about you?

p00hsticks wrote: »

Perhaps you mean the overall interest payment you get back at the end of the year expressed as a percentage of the total put in - but that's not the same as the interest rate.

Exactly p00hsticks that was the question.

Sorry if this got lost in translation and my wording should have been better.

Some forumites clearly understood the question I was asking as I got the reply to my question in particular eskbanker and yorkshireboy.