The Top Easy Access Savings Discussion Area

Mr._H_2

Masetw said:

Only moved savings into a chase account 3 days ago. Would it be worth opening a Zopa account now and moving again or just leaving for the time being?

I would say that that depends on how much savings you have in Chase and how you value your time.

For every £1000 in savings, at current rates (Chase = 1.5%, Zopa instant = 1.81%) you are losing out on about 1 pence per day by not moving the money.

Generally speaking, you should get used to moving your money regularly in order to keep earning the highest interest, especially when the base rate is changing often (as now).

Once you are used to it, and as long as you can be easily identified electronically (usually this means: been at your current address for more than 3 years, with continuous registration to vote at that address), you can typically open a new account in 5 to 10 minutes; then you have to arrange the money move which probably takes me about half an hour in all (I always send a test amount of £1 if the sending or receiving bank don't support account identification and often this can trigger "security checks" when I send the full amount).

moi

jimexbox said:

t1redmonkey said:

Is a zopa account quick and easy to open?

Very quick and easy, for myself anyway. 

Me too! Opened in minutes & my current account statement was then verified in under an hour.

Rollinghome

murphydavid said:

Rollinghome said:

Oasis1 said:

I've screwed up on that front. Should have picked monthly so have messaged to ask if I can change.

Ah, but you will get 1.75% instead of 1.74% (1.75% AER) if you move somewhere else after a month or so - which isn't too implausible at the moment.  Maybe enough to buy a few bubbles on your latte. (Pity about any extra tax of course. Could always close and re-open.)

You don't get less or more interest. They just working the math backwards so to speak. The interest is actually calculated daily on a daily rate. The real rate that's used but not stated. That rate is worked out backwards so that you would get the quoted APR if it was in for 365 days.
So if you work backwards from the APR to the monthly rate (or forwards from the daily rate) that will give you a percentage you can quote. Its just meaningless math. You always get the same APR both ways. If you chose monthly you just get more updates and a way to move interest from one tax year to the next.
As I understand it.

murphydavid  I think you may be confusing APR with AER. 

APR, Annual Percentage Rate, is the applied rate, whereas AER is the Annual Equivalent Rate, i.e. the return you would get only if you allowed your monthly interest to compound for a full year.  If you kept the deposit for less than a year, or withdrew the interest each month, then you wouldn't get the AER quoted.

The Shawbrook account pays an applied gross rate of 1.75% APR for annual accounts. The monthly account pays 1.74% APR, which with compounding, gives an AER of 1.75% after one year. . If you keep the account for just a month, as mentioned, there will be no compounding, just the 1.74% gross rate shown.  Whereas for the annual interest account you will get the full 1.75% gross rate, calculated daily, regardless of whether the account is open for a month, a day, or a year. 

Furthermore, if you close an annual account paying say 1.75% gross after less than a year, or between annual interest payments and, if you re-invest the interest received in another account paying a similar rate, you would get further interest on that interest and so potentially get an AER higher than the quoted applied rate.  Not that I suggesting you bother to do that.

RG2015

Rollinghome said:

murphydavid said:

Rollinghome said:

Oasis1 said:

I've screwed up on that front. Should have picked monthly so have messaged to ask if I can change.

Ah, but you will get 1.75% instead of 1.74% (1.75% AER) if you move somewhere else after a month or so - which isn't too implausible at the moment.  Maybe enough to buy a few bubbles on your latte. (Pity about any extra tax of course. Could always close and re-open.)

You don't get less or more interest. They just working the math backwards so to speak. The interest is actually calculated daily on a daily rate. The real rate that's used but not stated. That rate is worked out backwards so that you would get the quoted APR if it was in for 365 days.
So if you work backwards from the APR to the monthly rate (or forwards from the daily rate) that will give you a percentage you can quote. Its just meaningless math. You always get the same APR both ways. If you chose monthly you just get more updates and a way to move interest from one tax year to the next.
As I understand it.

murphydavid  I think you may be confusing APR with AER. 

APR, Annual Percentage Rate, is the applied rate, whereas AER is the Annual Equivalent Rate, i.e. the return you would get only if you allowed your monthly interest to compound for a full year.  If you kept the deposit for less than a year, or withdrew the interest each month, then you wouldn't get the AER quoted.

The Shawbrook account pays an applied gross rate of 1.75% APR for annual accounts. The monthly account pays 1.74% APR, which with compounding, gives an AER of 1.75% after one year. . If you keep the account for just a month, as mentioned, there will be no compounding, just the 1.74% gross rate shown.  Whereas for the annual interest account you will get the full 1.75% gross rate, calculated daily, regardless of whether the account is open for a month, a day, or a year. 

Furthermore, if you close an annual account paying say 1.75% gross after less than a year, or between annual interest payments and, if you re-invest the interest received in another account paying a similar rate, you would get further interest on that interest and so potentially get an AER higher than the quoted applied rate.  Not that I suggesting you bother to do that.

I thought APR was the rate used for borrowing, such as on mortgages.

When banks advertise savings rates, they generally use the terms AER and gross.

soulsaver

soulsaver said:

jimexbox said:

@ soulsaver. My 50k zopa cap has been removed. The full 85k is now available. 

 I understand that - the '?' is there because it isn't clear the £85k is for every one - I've had £85k since launch + 2days IIRC.
In fact the link I posted doesn't show the new rates but I can see them in my app... so I'm hoping they're clear and in the link tomorrow.
 

The Zopa web has now been updated confirming £85k max for all. ToTP amended.

cymruchris

Zopa has now increased the savings limit to £85k for all customers.... 

jimexbox

Been impressed with zopa.

They react to base rate rises quickly and Increase rates on notice pots.

I think the 95 day pot needs a tweak. Rate is too close to the 31 day for the extra 64 days notice required. 31 day is the sweet spot IMHO. 

Daliah

noh said:

t1redmonkey said:

Is a zopa account quick and easy to open?

It should be but they need to verify your nominated bank account before you can make a deposit. Despite me uploading the required documents immediately they did not verify the linked account until 10 days later and then only after prompting.

They might have more staff processing verification requests now. My Starling account got verified within 90 minutes today. My Santander account didn't need extra verification.

noh

Daliah said:

noh said:

t1redmonkey said:

Is a zopa account quick and easy to open?

It should be but they need to verify your nominated bank account before you can make a deposit. Despite me uploading the required documents immediately they did not verify the linked account until 10 days later and then only after prompting.

They might have more staff processing verification requests now. My Starling account got verified within 90 minutes today. My Santander account didn't need extra verification.

Yes. I suspect that in my case something went wrong and verifying my accounts was just wasn't progressed.

Rollinghome

RG2015 said:

Rollinghome said:

murphydavid said:

Rollinghome said:

Oasis1 said:

I've screwed up on that front. Should have picked monthly so have messaged to ask if I can change.

Ah, but you will get 1.75% instead of 1.74% (1.75% AER) if you move somewhere else after a month or so - which isn't too implausible at the moment.  Maybe enough to buy a few bubbles on your latte. (Pity about any extra tax of course. Could always close and re-open.)

You don't get less or more interest. They just working the math backwards so to speak. The interest is actually calculated daily on a daily rate. The real rate that's used but not stated. That rate is worked out backwards so that you would get the quoted APR if it was in for 365 days.
So if you work backwards from the APR to the monthly rate (or forwards from the daily rate) that will give you a percentage you can quote. Its just meaningless math. You always get the same APR both ways. If you chose monthly you just get more updates and a way to move interest from one tax year to the next.
As I understand it.

murphydavid  I think you may be confusing APR with AER. 

APR, Annual Percentage Rate, is the applied rate, whereas AER is the Annual Equivalent Rate, i.e. the return you would get only if you allowed your monthly interest to compound for a full year.  If you kept the deposit for less than a year, or withdrew the interest each month, then you wouldn't get the AER quoted.

The Shawbrook account pays an applied gross rate of 1.75% APR for annual accounts. The monthly account pays 1.74% APR, which with compounding, gives an AER of 1.75% after one year. . If you keep the account for just a month, as mentioned, there will be no compounding, just the 1.74% gross rate shown.  Whereas for the annual interest account you will get the full 1.75% gross rate, calculated daily, regardless of whether the account is open for a month, a day, or a year. 

Furthermore, if you close an annual account paying say 1.75% gross after less than a year, or between annual interest payments and, if you re-invest the interest received in another account paying a similar rate, you would get further interest on that interest and so potentially get an AER higher than the quoted applied rate.  Not that I suggesting you bother to do that.

I thought APR was the rate used for borrowing, such as on mortgages.

When banks advertise savings rates, they generally use the terms AER and gross.

It is. Just means Annual Percentage Rate whether you pay it to someone or someone pays it to you. Now used for cost of a loan including all extra costs. Gross used to be used only for the rate without tax deducted.when all savings were paid net, tax paid. https://www.investopedia.com/terms/a/apr.asp