Same interest calculation but different pay frequency

PSuspiro

Hi,
Comparing a Help to Buy account between two banks and see that they have the same interest rate, the same way to calculate, the interest go to the same account, but different credit frequency. So I guess my questions is:
Which one is the best option: "Interest is calculated daily and credited to the account monthly" or "interest is calculated daily and paid annually"?

Thanks

eskbanker

Evaluate them based on the AER figure, which is structured to give a comparable figure of total interest earned per year regardless of frequency of paying it. For a given AER, the gross figure quoted for a monthly-paying account will be lower than the AER, for an annual-paying account the gross and AER will be the same.

AnotherJoe

As said just look at the AER, which takes the frequency into account. Highest is best.

G_M

It also depends whether you want access to the interest to supplement your monthly income, or whether you're happy to wait till the end of the year.

badger09

G_M wrote: »

It also depends whether you want access to the interest to supplement your monthly income, or whether you're happy to wait till the end of the year.

Not much point using a HTB ISA for that purpose:cool: