Tesco Savings

ColdIron

Yes £3,000 * 0.3% = £90 * 4 accounts = £360

eric4395

ColdIron wrote: »

Yes £3,000 * 0.3% = £90 * 4 accounts = £360

So just leave it in for 2 years and don't take the interest out every month, is that what you are saying..I am sure on another thread about tesco savings somebody said to take the interest out every month for max value.

ColdIron

I'm not saying whether you should leave it in or take it out, that's up to you. You could leave the interest in and it would make no extra money. If you took it out each month and put it into a 1% savings account it would make an extra £1.95 in the first year or £7.51 extra in total after 2 years. Or you could skip a cup of cheap coffee every 6 months

djpailo

eric4395 wrote: »

So just leave it in for 2 years and don't take the interest out every month, is that what you are saying..I am sure on another thread about tesco savings somebody said to take the interest out every month for max value.

Its very simple, just read the post by colsten

Wrong. You get interest paid on to anything up £20K. You get no interest on any money above £20K.

Example:
You have £22,000 in your Santander 123.
You will get interest for £20,000.
You will get no interest for £2,000.

Tesco current accounts work in a similar way, just that their upper limit that earns any interest is £3,000.

If you put £3000 right now into ONE account, you would get 3% AER for the first month. That would give you about £7.50 (3% of £3000 then divide by 12 months). Now you have £3007.50 for the second month. You would then wait til the end of the second month and then get interest on the £3000 once more. So that is another £7.50. Your total amount in the end of the second month is £3015.00. It really is that simple. On the third month, you would get another £7.50 and that would give you £3022.50 total at the end of the third month.

As another example, anything OVER £3000 does not gain interest, so if you put £6000 into ONE account in the first month, your interest at the end of the first month would still be £7.50 and not £15. So your total at the end of the first month would be £6007.50 in this case.

If you don't understand it after this explanation, just open the account, put £3000, and forget about it, only periodically checking the statements to ensure there is no suspicious activity taking place.

eric4395

ColdIron wrote: »

I'm not saying whether you should leave it in or take it out, that's up to you. You could leave the interest in and it would make no extra money. If you took it out each month and put it into a 1% savings account it would make an extra £1.95 in the first year or £7.51 extra in total after 2 years. Or you could skip a cup of cheap coffee every 6 months

Ok thanks Coldlron, since you explained it that way, I will just leave it for the 2 years untouched and skip the coffee:)

Adzie

Sorry to steal the thread a bit but out of curiosity when is interest paid from Tesco?

I opened an account back in December and placed £10 in. On the 18th Jan i received a payment of 2p.

Am I right to assume its monthly?

colsten

Adzie wrote: »

Sorry to steal the thread a bit but out of curiosity when is interest paid from Tesco?

I opened an account back in December and placed £10 in. On the 18th Jan i received a payment of 2p.

Am I right to assume its monthly?

What did the T&Cs say that you accepted when you signed up?

Adzie

colsten wrote: »

What did the T&Cs say that you accepted when you signed up?

It doesn't say anything about when it is paid. Just states its 3% up to £3000

eskbanker

ColdIron wrote: »

Yes £3,000 * 0.3% = £90 * 4 accounts = £360

Strictly speaking, with a fully-loaded account (so interest doesn't compound), it's the gross rate rather than the APR that would apply, so £3,000 * 2.96% = £88.80 * 4 accounts = £355.20, so a couple less cheap coffees!

eskbanker

Adzie wrote: »

It doesn't say anything about when it is paid. Just states its 3% up to £3000

See https://yourcommunity.tescobank.com/t5/Current-Accounts/When-is-interest-paid-on-my-current-account/ta-p/719