how much interest do you earn per year? (percent)

savings_my_hobby

Hi everyone,

I have been slightly obsessed with my interest rates lately. I try to save money every week and no soon as I do I find myself calculating my total interest earnings for the year then dividing that by the total amount I have across my accounts then multiplying that by 100 to give me my total interest percentage.

One rule I use to calculate my overall percentage regarding my Halifax Reward account is to assume my balance is £1, this is because you only need at least £1 in this account to net £60 per year (after other requirements have been met), where as you need £2000 in tsb to net £78.20 (br tax payer). As a result when I calculate my total balance I ignore anything over £1 in the reward account (this money is for bills and essentials anyway and is largely spoken for so I'm not cheating to hike my percentage up). Although this does hike the percentage up.

So many of us will be in for a treat in April when we should be able to earn £1000 interest per year tax free, (£500 for hr tax payers) something which I and many others have mentioned time and time again, so we should all see our rates rise substantially, except some of us will have just completed our one year Nationwide 5% "bonus", which will have an adverse affect on the overall percentage when this gets reduced from 5 to 1 %. So some decisions will have to be made what to do with the £2500 especially now the 5% regular saver at £500 per month has been launched and the need to be a nationwide customer to qualify.

For people who drip feed into regular savers it may not be straight forward to calculate how much interest they are earning per year but my ever changing total as of today is 3.12% net. Which in these times of deflation is actual growth not just defending against inflation.

This 3.12% could be slightly higher if I had a club lloyds account, but since I hold several Halifax and B.O.S accounts I get worried about being excluded from Lloyds banking group products like people were reporting on this site a while back.

What is your overall return on on your savings?

bowlhead99

Probably somewhere between 1 and 2% before tax. Some of my pounds are earning quite a lot more than 2% but other amounts are at 1 or less, for overall convenience.

DragonQ

Impossible to tell because of regular savers. If I look at what I'd earn this month and multiply by 12 I'm earning 4.1% gross, 3.3% net. Once the tax rules change that'll obviously go up but it's going to get really complicated to figure out how much tax I'm going to owe up front.

savings_my_hobby

DragonQ wrote: »

Impossible to tell because of regular savers. If I look at what I'd earn this month and multiply by 12 I'm earning 4.1% gross, 3.3% net. Once the tax rules change that'll obviously go up but it's going to get really complicated to figure out how much tax I'm going to owe up front.

The way I calculate is by adding together all the interest I should earn off each account in a year i.e Tsb £78.2 + Nw £97.75 + halifax reward £60 = £235.95

divided by the balance across the accounts

Tsb £2000 + nw £2500 + halifax reward £1 = £4501

= 5.24%

for reg savers there is martins reg saver calculator i.e tsb reg saver £250p/m @ 5% = approx. £80.64

just add in figures and get an approximate returns estimate and work that in. there is also a drip feeding calculator.
http://www.moneysavingexpert.com/savings/best-regular-savings-accounts

right at the bottom of page

YorkshireBoy

If it's a competition, the 'winners' in % terms (the title/theme of your thread) will be those with very little savings, ie those with just the 5% and 4% current accounts. As you're limited to £9.5K in those, it follows that the more savings you have, the lower your % return.

Consequently, those with £50.5K (the max in 3-5% AER current accounts) will be very close to 3% I'd imagine...due to their having the other £41K at 3% AER in Santander, Tesco, and BoS.

The above ignores regular savers of course.

savings_my_hobby

YorkshireBoy wrote: »

If it's a competition, the 'winners' in % terms (the title/theme of your thread) will be those with very little savings, ie those with just the 5% and 4% current accounts. As you're limited to £9.5K in those, it follows that the more savings you have, the lower your % return.

Consequently, those with £50.5K (the max in 3-5% AER current accounts) will be very close to 3% I'd imagine...due to their having the other £41K at 3% AER in Santander, Tesco, and BoS.

The above ignores regular savers of course.

Its not a competition, Mainly for the very reason you just (rightly) stated. As my example in post #4 demonstrates where you can get >5% on <5k. Those of us with more than £4501 will inevitably have to settle for smaller returns on our extra balance as we run out of accounts to open.

What i'm hoping for is some of the stock markets investors or p2p lenders come on here and compare their returns with the us too. Mainly so when I have maxed out all my options with safe returns on current accounts I will have a realistic range of what to returns to expect if I then decide to explore that area, Of course I realise this may depend on my attitude to risk and other factors too.

Kendall80

Overall with investments included i'm afraid i'm barely breaking even this year so far. Cash interest roughly 3.2% net.

Archi_Bald

savings_my_hobby wrote: »

So many of us will be in for a treat in April when we should be able to earn £1000 interest per year tax free, (£500 for hr tax payers)

The treat will be £200 max additional cash, for either basic rate or higher rate payers, spread out over the tax year 2016-17, as well as in subsequent tax years if the legislation stays the same.

As YorkshireBoy has pointed out, those with smaller amounts to save will be able to achieve a higher percentage than those with larger amounts. Sadly, we see over and over again from posts on here that a great number of those who could achieve higher interest rates keep their money in dire places such as cash ISAs.

I am not bothering with working out the interest rate across all my accounts. Instead, I just make sure that I fully use the best AER rates before I move down the ladder to the next best AER. By definition I therefore get the best interest rate that I could possibly get for my cash, whatever that rate might actually be. I

savings_my_hobby

YorkshireBoy wrote: »

Consequently, those with £50.5K (the max in 3-5% AER current accounts) will be very close to 3% I'd imagine...due to their having the other £41K at 3% AER in Santander, Tesco, and BoS.

The above ignores regular savers of course.

I honestly think gaining around 3% on 50k is worth the time and effort in setting up these accounts because the risk factor is so low, we are fscs protected and if the variable rate drops we can just move our money somewhere else. Reg savers may be a little less flexible of course

Sam_J12

I'm getting 5.0% net on £10,700 currently (Flexdirect, TSB Classic, Club Lloyds, Halifax Reward, Halifax HTB)

savings_my_hobby

Sam_J12 wrote: »

I'm getting 5.0% on £10,700 currently (Flexdirect, TSB Classic, Club Lloyds, Halifax Reward, Halifax HTB)

Thats a nice return, like archi said as long as you pick and fully use the highest paying accounts your golden. I used to have sums like that kicking around in low interest current accounts and isa's before I discovered these forums and became rate aware. I was further vindicated a few months ago when my cash isa (very small balance) interest rate was cut from a poultry 1.2% to 0.8%. good job sam