What is the best savings account - non-ISA right now?

Snooping4Value

Archi_Bald wrote: »

Sorry for trying to help you to make over twice the interest you get in your 1.3% account. I won't try to help you again.

As I said earlier, I think everyone just started off on the wrong foot. I don't think Edelman didn't mean what he said in that sort of context. Let's all chill. :beer:

Edelman wrote: »

I just never realised you could have multiple current accounts - I naively thought those were for Direct Debits etc.

I now know better!

So I have the NW account with 5%, which looks to be to be actually better than FD or S123. S123 would possibly get me £50-60 in the year after the fee. FD would give me nothing, unless I remember to close it just at the right moment.

However, and this is based on my (poor) knowledge of AERs, if I had £2000 in my account at the end of the year, does that mean I earn £100 for having the account?

How does it work out - or better question - how do you "work it" so you get full value on your AER ?

Traditionally current accounts didn't work that way. They only started doing it in the last few years.

Anyway, assuming you have £2000 in an account paying 5% interest gross for a full year, you do get £100 interest gross. If you are a basic tax rate payer, you get the interest taxed at source, so you get £80.

Eco_Miser

Edelman wrote: »

However, and this is based on my (poor) knowledge of AERs, if I had £2000 in my account at the end of the year, does that mean I earn £100 for having the account?

No.
If you had £2000 in the account at the beginning of the year, and left it, and the interest added each month, in the account until the end of the year, then you would earn £100 gross (£80 net of BR tax).

Edelman wrote: »

How does it work out - or better question - how do you "work it" so you get full value on your AER ?

Put £2500 in on day one, withdraw the interest each month, as well as paying in/withdrawing the required amount to meet the funding condition. You don't get the full AER because there is no compounding, but you do get the maximum possible interest.

Edelman

So to get the £100 out of it, I'd need to get over £2k in every month, never drop below?

eskbanker

Edelman wrote: »

So to get the £100 out of it, I'd need to get over £2k in every month, never drop below?

The interest is calculated on the closing balance at the end of each day, so you'd need to keep £2K in all the time to get £100 gross over the year. You need to satisfy the minimum monthly funding requirement too but as there's no interest above £2.5K balances then you'll be reversing those monthly payments out again.