Fixed rate saver

kangarooz

I have a Halifax 2 year fixed onlone saver but I want to close it. It states I would lose 180 days gross interest; I currently get monthly interest but it varies month to month between £1.76 and £2.08. So roughly if I closed the account would I have to pay about £12 to close it? The balance is £1800 with 1.59% gross interest.

PeacefulWaters

I make it £14.11.

The penalty is gross interest and I'm assuming you're getting paid interest net.

jimjames

Looks like its well worth closing. You'd recoup any penalty quickly with a tsb account.

kangarooz

I'm really not sure how to work out the interest as I got it wrong last time, the tsb account is ''5% AER/4.89% gross variable'', So if I transferred in £2000 which is the max as an example what monthly interest would I get?

Frogletina

I received £6.86 in June

Eco_Miser

£2000 times 4.89% = £97.80 gross per year
multiply by 80% (or 0.8) to get the net amount = £78.24
divide by 12 to get the average monthly amount = £6.52.
The actual amount will vary by a few pence depending on the length of the accounting month.

Since the account is fully funded to begin with, there is no compounding of the interest, and you don't actually get 5% (or 4% after tax).

General_Grant

kangarooz wrote: »

I have a Halifax 2 year fixed onlone saver but I want to close it. It states I would lose 180 days gross interest; I currently get monthly interest but it varies month to month between £1.76 and £2.08. So roughly if I closed the account would I have to pay about £12 to close it? The balance is £1800 with 1.59% gross interest.

It would cost you just over £14 to close it.

Calculation

£1800 x 0.0159 * 180/365 = £14.11 (rounded down to whole pence)

The amount you are quoting for monthly interest is a nett sum, not gross.

When they say they will deduct 180 days gross interest, that is what would be deducted, not nett interest.

kangarooz

Thanks for replies in end cost £11.29 to close account, Will open a tsb account this week I think

General_Grant

kangarooz wrote: »

Thanks for replies in end cost £11.29 to close account, Will open a tsb account this week I think

In that case they seem to have charged you only the nett interest rate not gross.