Kent Reliance

G_M

Ness9866 wrote: »

Having done some research, I am about to open a bond account with Kent Reliance.
The one year account offers 1.85% the two year offers 2.10% and the four year offers 2.35%
However all the accounts allow instant access with the loss of 180 days interest.

It seems a no brainer to take the four year offer so even if I do need the money I will be better off. Am I correct or am I missing a rather obvious point?

Is there a snazzy calculator on the interweb somewhere that shows how much interest you'd lose if you withdrew £X cash after Y months/years...?
so you can compare wih what you'd earn on a lower-paying account/bond ?

eskbanker

G_M wrote: »

Is there a snazzy calculator on the interweb somewhere that shows how much interest you'd lose if you withdrew £X cash after Y months/years...?
so you can compare wih what you'd earn on a lower-paying account/bond ?

180 days of lost interest would always be £X x interest rate x 180/365, regardless of Y!

G_M

But if the rate were, say, 2.1%, and you earned this for, say 1 year (or 1.5 or 2 years) but then lost 180 days interest, would that equate to, or beat, an interest rate of, say 1.3% ( 1.1% or 1.4% etc) with no loss of interest?

eskbanker

G_M wrote: »

But if the rate were, say, 2.1%, and you earned this for, say 1 year (or 1.5 or 2 years) but then lost 180 days interest, would that equate to, or beat, an interest rate of, say 1.3% ( 1.1% or 1.4% etc) with no loss of interest?

A rough and ready way of looking at it (ignoring compounding) is to treat the Kent earning period as being half a year shorter than the one you're comparing with, i.e.

Kent interest = £X x 2.1% x (Y-0.5)
Other interest = £X x 1.3% x Y

The impact of the lost interest becomes less significant as time goes by, favouring the Kent product if kept beyond a break-even point of about 15 months by my fag packet calculations for those particular interest rates....

G_M

eskbanker wrote: »

A rough and ready way of looking at it (ignoring compounding) is to treat the Kent earning period as being half a year shorter than the one you're comparing with, i.e.

Kent interest = £X x 2.1% x (Y-0.5)
Other interest = £X x 1.3% x Y

The impact of the lost interest becomes less significant as time goes by, favouring the Kent product if kept beyond a break-even point of about 15 months by my fag packet calculations for those particular interest rates....

Thanks for that.

But no "snazzy calculator on the interweb anywhere" where you can pump numbers in and get numbers out that anyone knows of.