How much interest will I make

fimonkey

Can I just ask, on the original calculations from Yorkshire Boy
£3,000 x 7.5% / 12 x 6.5 x 0.8 = £97.50

£3000= total amount saved (ie £250 x 12 mnths)
7.5% = interest rate
/12 = divide by 12 months
x6.5
x0.8 = the rate you get if you're a 20% tax payer.

Where did the 'multiply by 6.5' come from??

Apologies for my ignorance

Aegis

6.5 is the rough multiplier to account for compounding on top of what would be 6 months interest if compounding wasn't a factor.

Hope that makes more sense to you than it does to me when I reread it!

Afahmaep

I opened a Britannia 7.5% Regular Saver on 02/11/06 and have received interest of of £98.59 on 02/11/07.

Miss_Sparkly_Star

One more question please.

Which will be better financially for me to open...

the britannia saver for a year if I open it this week or the nationwide fixed isa @6.15, don't understand how they work the interest out on this and whether the 6.15% will be honoured to nov 08 or will end at the beginning of the new financial year.

Basically i'm getting confised do i do an isa or a reg saver (btw the isa's going in my mums name as i've already paid into my isa for this year)..better hope she doesn't make any withdrawals:p

Miss_Sparkly_Star

afahmeap - did you pay in 250 a month to that?

mary

Liz_the_Whizz wrote: »

Which equates to an annual interest rate of 3.25%.

You are forgetting to add to it the interest on the amount of money which is sitting in the feeder account in the meantime.

Afahmaep

Miss_Sparkly_Star wrote: »

afahmeap - did you pay in 250 a month to that?

Yes. And I have already opened a new Regular Saver 2 so that I have a continual membership with Britannia BS before I removed the £3098.59 plus interest which I did yesterday.
The matured funds have been 'shifted' into 2 High Interest Current accounts (Abbey 8.00% and Halifax 6.17%) from where they will be 'dripfed' back into the Britannia RS2 and various other Regular Savers that I have.

fimonkey

Sorry Afahmaep, I don't understand what you mean when you say "6.5 is the rough multiplier to account for compounding on top of what would be 6 months interest if compounding wasn't a factor".....

Why 6 months interest if it's a 12 month account?

Aegis

fimonkey wrote: »

Sorry Afahmaep, I don't understand what you mean when you say "6.5 is the rough multiplier to account for compounding on top of what would be 6 months interest if compounding wasn't a factor".....

Why 6 months interest if it's a 12 month account?

Because the mean residence time of the overal amount is 6 months if you feed in a fixed portion a month for 12 months. I.e. the first portion will be in the account for a year, the next will be in for 11 months, etc

Retired_I.F.A.

YorkshireBoy wrote: »

I wouldn't rely on the MSE calculator (or your method of calculation, using months not days)...at least until they iron out all the creases!

Very true. actually I only used it because my batteries in my psion are dead. I've a load of programs like this that i wrote years ago that are 100% accurate. !!!!!!ed if I can remember now how to convert them from psion spreadsheets to xls though I'll have to get the manual out.