📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!

The Top Easy Access Savings Discussion Area

Options
19339349369389392004

Comments

  • Band7
    Band7 Posts: 2,285 Forumite
    1,000 Posts Name Dropper
    BooJewels said:
    I did use the calculator you linked to check my thinking before posting.  Apologies if I'm misunderstanding.

    Working on the fact that many regular savers limit how much you can pay in each month, I worked on £200 per month, resulting in £2400 saved in a year, giving rise to interest of £65 @ 5%.  Drip feeding it from an EA account gave £66 interest and putting £2400 into a 1 year fix @ 4.3% gave £103.20 interest.
    We were talking about deciding between keeping the funds in an instant access account or putting them into a fixed term account, where you don't have access until maturity.

    So the first comparison is between access and no access, not between interest rates.

    @chris_the_bee suggested there is a half-way house by using Regular Savers which allow withdrawals and/or early closure. Provided the Regular Saver rate is higher than that of the easy access account, that half-way house approach wins any day on rate. It clearly also wins as far as accessibility is concerned.




  • BooJewels
    BooJewels Posts: 3,006 Forumite
    Part of the Furniture 1,000 Posts Photogenic Name Dropper
    Thanks all - the calculator definitely gave me £66 - I was expecting a bit more than that, so did it again.  But the derision I encountered from my post made me grab a calculator and work it out myself - and I got £92.45 = £27.46 from EA and £64.99 from the regular saver.   So an additional £32.45 over leaving the same £2,400 in an easy access @ 2.5%.
  • Band7
    Band7 Posts: 2,285 Forumite
    1,000 Posts Name Dropper
    BooJewels said:
    Thanks all - the calculator definitely gave me £66 - I was expecting a bit more than that, so did it again.  But the derision I encountered from my post made me grab a calculator and work it out myself - and I got £92.45 = £27.46 from EA and £64.99 from the regular saver.   So an additional £32.45 over leaving the same £2,400 in an easy access @ 2.5%.
    You get the £66 if you use the RS only, making deposits from an account which pays no interest.

    If you use the drip feed from a savings account, the calculator gives you much the same amount you worked out for yourself 👍
  • RG2015
    RG2015 Posts: 6,055 Forumite
    Ninth Anniversary 1,000 Posts Name Dropper Photogenic
    MSE Regular savings calculator result £93.




  • Sensory
    Sensory Posts: 497 Forumite
    Part of the Furniture 100 Posts Name Dropper
    BooJewels said:
    Thanks all - the calculator definitely gave me £66 - I was expecting a bit more than that, so did it again.  But the derision I encountered from my post made me grab a calculator and work it out myself - and I got £92.45 = £27.46 from EA and £64.99 from the regular saver.   So an additional £32.45 over leaving the same £2,400 in an easy access @ 2.5%.
    The calculator results in £66 if you set the normal interest rate between 0.05% and 0.13% inclusive.

    Simple formulae:

    Regular Saver: 6.5 x Monthly Amount x Rate
    • 6.5 x 200 x 5% = £65
    Drip Feed (normal rate interest)
    • 5.5 x M x R
    • 5.5 x 200 x 2.5% = £27.50
  • BooJewels
    BooJewels Posts: 3,006 Forumite
    Part of the Furniture 1,000 Posts Photogenic Name Dropper
    I get it, I'm not sure why you're all putting so much effort into correcting me, I already admitted I got something wrong and corrected myself.

    I used the calculator on my tablet and the form must be truncated on the smaller screen (it certainly doesn't look like @RG2015 posted above) - now on my computer, I see the box to put the EA interest in and it won't proceed without it - yet somehow it did on my tablet.

    I won't trouble you any further.
  • where_are_we
    where_are_we Posts: 1,222 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    edited 27 November 2022 at 8:17PM
    Remember when you put your money in a year fix the interest rate will remain the same and you are locked in. EA are variable interest rate accounts and a lot of RS accounts are also variable interest rate accounts. So any comparison over a year is going to change. Over the last year, interest rate have been on an upward trend and there has been many a MSE poster rueing the fact that they locked money in a 1year fix at what at the time seemed a good rate only to see better rates become available. However I do realise this upward trend may be plateauing out.
  • Bigwheels1111
    Bigwheels1111 Posts: 3,038 Forumite
    1,000 Posts Third Anniversary Name Dropper
    edited 27 November 2022 at 9:02PM
    I finally bit the bullet and opened 2 five year fixed deals with annual interest paid away for an income.
    A 3 year fixed ISA with emergency fund in it. Will cost £200 to access the funds, but that’s a small price to pay if needed.
    Still have 2 FD regular savers.
    A mix of all types of accounts.
  • Does anyone know where to work out the true interest rate? E.g. 2.81% Al Ryan and drip feed to Monmouthshire 5.5% account. I can work out the interest easily with the MSE calculator but what would the rate be?
This discussion has been closed.
Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 351.1K Banking & Borrowing
  • 253.2K Reduce Debt & Boost Income
  • 453.6K Spending & Discounts
  • 244.1K Work, Benefits & Business
  • 599.1K Mortgages, Homes & Bills
  • 177K Life & Family
  • 257.4K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16.1K Discuss & Feedback
  • 37.6K Read-Only Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.