Best bank account for 15 year old ?

BlightyAndy

gt94sss2 wrote: »

Lloyds may pay interest quarterly but the annual rate of interest is 3.3% AER (not quarterly)

HSBC is 5.75% AER (paid monthly) and the Nationwide cashcard account is 6.04% AER (not sure how often interest is paid)

The account which pays the highest AER will pay you the most interest over the year - regardless of how often they pay interest through the year (annually/quarterly/monthly etc)

Also don't forget to ask your bank for an R85 form if you dont currently get interest paid gross as its very unlikely you earn enough to pay tax!

Regards
Sunil

I don't understand what AER is?
All i know is you DO get 3.33% every quarter.
And nationwide is paid every 6 months, Barclays also pay 5.something% every quarter (Gross and AER).

smithja

The "A" stands for annual, so if the AER is 3.33% (before tax) and it is paid every quarter then you will be paid a quarter of that rate on your money, and then if you leave all of the money in the account, you would be receiving compound interest at the next quarter and there after. This would be the same for monthly (rate/12), every six month (rate/2), unless anyone knows better?James

BlightyAndy

Oh so its Annual Equalivent Rate?

BlightyAndy

Question about BarclayPlus

So do i get 5.25% gross interest every quarter/3 months (5.88% AER) or what?
Like, if i had £100 in my account would i earn £5 interest every 3 months?

gt94sss2

AndyGrayUK wrote: »

So do i get 5.25% gross interest every quarter/3 months (5.88% AER) or what?
Like, if i had £100 in my account would i earn £5 interest every 3 months?

No, in the first 3 months you would get £1.31 interest (5.25/4)

If you left the £100 in the account (and all the quarterly interest payments) after one year, you would have a total of £105.88 in the account

Regards
Sunil

BlightyAndy

Thanks for clearing that up lol

BlightyAndy

Actually, i'm still confused...
If i get 5.25% gross interest paid through out the year (every 3 months) then what is the 5.88% AER there for?
ARGH This is really confusing me.
So do HSBC also pay the 5.something% interest through out the year?
And nationwide deffenitly paid 5.96% Gross interest every 6 months, right (6.04% AER)?

AND does the halifax regular saver actually pay 10% a month or is it through out the year?

SOOOOO CONFUSED!!!

BlightyAndy

gt94sss2 wrote: »

No, in the first 3 months you would get £1.31 interest (5.25/4)

If you left the £100 in the account (and all the quarterly interest payments) after one year, you would have a total of £105.88 in the account

Regards
Sunil

So what would i get in the 2nd, 3rd and fourth month? Read above post aswell please, im completely confused still. :embarasse

gt94sss2

AndyGrayUK wrote: »

If i get 5.25% gross interest paid through out the year (every 3 months) then what is the 5.88% AER there for?

While they pay 5.25% on any cash in the account, the 5.88% includes the interest they will pay on the interest credited to your account each quarter

So if you had £100 and they paid interest quarterly:

- if you took out the interest every quarter as soon as it was added to your account and put it somewhere else where it got 0% you would have a total of £105.25 after a year

- if you left the £100 and any interest received remained in the account instead at the end if the year, you would have a total of £105.88

so you would basically be getting 63p interest per £100/year on the interest they have already paid you..

With Nationwide and HSBC or any other normal savings account- just compare the AER figures, they are the most accurate and thats why they have to quote them.

With the 10% Halifax account or any other regular saver, the interest rate is a bit misleading though..

Regards
Sunil

BlightyAndy

Thanks
So the 5.88% AER is paid every year and the 5.25% spread over the year?