5% savings loophole on this weeks MSE newsletter

le_loup

innovate wrote: »

Because they have never been taught anything about interest rates (and inflation and savings and investment) in school?

Or maths in many cases!

evenasus

jimjames wrote: »

Quite why anyone expects to be paid interest on money that is not in an account beats me.

I've read a few posts where people think this.

This one stuck in my mind...

2Yr 4%ISA fed from 1year fixed saver on 11th hour of 1st year ISA anniversary.

https://forums.moneysavingexpert.com/discussion/comment/52255247#Comment_52255247

I'm not sure the poster really understood what I was telling him.

le_loup

evenasus wrote: »

2Yr 4%ISA fed from 1year fixed saver on 11th hour of 1st year ISA anniversary.

Thanks for sharing. It really was quite sad.

Eco_Miser

jimjames wrote: »

There does seem to be a perception in some posts that they can get the full interest on the money by it being in the account on one day at the end of the month.
Quite why anyone expects to be paid interest on money that is not in an account beats me.

Maybe because of posts like this:

jimjames wrote: »

On £1000 you can get equivalent of 12.5% interest doing that with tsb and Halifax accounts.

Halifax Rewards just need the money to be in the account for seconds. This may have created an expectation for other accounts to be the same.

Or maybe it's just a lack of knowledge :shrug:

Archi_Bald

Here's another one from today - https://forums.moneysavingexpert.com/discussion/4983731

le_loup

It is a shame that people don't know ... but, probably, we didn't understand how it worked when we were 18.

evenasus

le_loup wrote: »

It is a shame that people don't know ... but, probably, we didn't understand how it worked when we were 18.

I did, I worked in a Bank/Finance House.

It put me off credit for life!

dale_cotterill

A quick glance through would suggest that it isn't actually the interest rates that are getting people confused, but the reason for moving the money in the first place, just the basic premise of the scheme.

The only reason to move money is to ensure that the account qualifies for interest to be paid. (Pay in £x amount a month to get the rate)

You basically just bounce it in and straight out again from your current account.

Treat the £2000, £5000 or whatever else as savings. You put it there, and leave it there and do nothing with it.