Am I mistaken about Interest Rate %'s on Virgin Money M Plus Account

eskbanker

Molly4 said:

I am a mature person in very poor health. I have a very small income. I am a few years short of State Pension age so I do not qualify for all the Benefits and Discounts Pensioners are able to claim. Because I have Savings I do not qualify for means tested Benefits so lose out that way as well.

Of course the other way of looking at it is that you're in the fortunate position of having enough savings not to have to rely on the state supporting you, but if you're depleting those savings for living costs then that could change in the future.  Whether or not the situation changes when you reach pension age will depend on your finances then, but some benefits available to pensioners are dependent on receiving pension credit, which is also means-tested.

Anyway, none of that changes the advice offered above about optimising your interest by chasing better rates!

RG2015

I was reading about pension credit the other day and was interested to see that it wasn’t automatically affected by having savings or owning your home.

 @Molly4 , I assume that you are aware of this and will be prepared when you get closer to state pension age.

Molly4

RG2015 said:

I was reading about pension credit the other day and was interested to see that it wasn’t automatically affected by having savings or owning your home.

 @Molly4 , I assume that you are aware of this and will be prepared when you get closer to state pension age.

Yes I am aware and am counting the days until I get my State Pension. 628 days to go!!!

Band7

RG2015 said:

I was reading about pension credit the other day and was interested to see that it wasn’t automatically affected by having savings or owning your home.

 @Molly4 , I assume that you are aware of this and will be prepared when you get closer to state pension age.

Details about Pension Credit eligibility here: https://www.gov.uk/pension-credit/eligibility

phillw

Molly4 said:

My understanding of this is I would be paid 2.00% Interest every month on a Balance up to £1000 on the M Plus Current Account

Approximately 1/12 of 2% of the balance, in reality they divide the 2% by 365 (or 366 in a leap year) and then apply that to the balance at the end of each day & pay it monthly.

So you would need to look at when during the month you paid the money in, and what the interest rate was at the time. You don't get paid for a full months interest by putting the money in on the last day for example. Rates have risen on the savings account over the last year.

I don't believe they offered 2% on the linked saving back in february.

This is what their web site looked like back then...

https://web.archive.org/web/20220217182738/https://uk.virginmoney.com/current-accounts/pca/

Yorkie006

@Molly4 If you don't want to switch banks, Virgin does have an easy access ISA paying 3% AER available to existing current account customers. Might be worth considering as most other non-ISA easy access accounts are paying less then that. You can always move it to a different account if a better offer comes along.

Yorkie006

phillw said:

I don't believe they offered 2% on the linked saving back in february.

I think back then the rates were 2% for current account (on a balance up to £1000) and 1% saving account (balance up to £25000). I opened mine around that time. If you opened the current account and switched another account to it, the interest went up to 3% for a year.

Molly4

phillw said:

Molly4 said:

My understanding of this is I would be paid 2.00% Interest every month on a Balance up to £1000 on the M Plus Current Account

Approximately 1/12 of 2% of the balance, in reality they divide the 2% by 365 (or 366 in a leap year) and then apply that to the balance at the end of each day & pay it monthly.

So you would need to look at when during the month you paid the money in, and what the interest rate was at the time. You don't get paid for a full months interest by putting the money in on the last day for example. Rates have risen on the savings account over the last year.

I don't believe they offered 2% on the linked saving back in february.

This is what their web site looked like back then...

https://web.archive.org/web/20220217182738/https://uk.virginmoney.com/current-accounts/pca/

The offer I took up was via MSE's Money Saving Newsletter as of 16th February 2022 which took me to the offer on the Virgin Money Website as below which is taken from my sign up page.

Our page at a glance

Account overview|Get started 

Things just got interesting...

M Plus Account

2.02%

Feast on a 2.02% AER1 (2.00% gross1 per annum variable) interest rate, paid monthly, on your M Plus Account balance up to £1,000.

Linked to the M Plus Saver

2.02%

AER1 (2.00% gross1 per annum variable) on savings balances up to £25,000, and 1.51% AER (1.50% gross1) on any balances above £25,000. Interest paid quarterly.

Monthly Fee

£0

There is no Monthly Fee for Maintaining the M Plus Account

Molly4

Yorkie006 said:

@Molly4 If you don't want to switch banks, Virgin does have an easy access ISA paying 3% AER available to existing current account customers. Might be worth considering as most other non-ISA easy access accounts are paying less then that. You can always move it to a different account if a better offer comes along.

Thank you for pointing this out. I don't actually know anything about ISA's and how they work.

k_man

Molly4 said:

phillw said:

Molly4 said:

My understanding of this is I would be paid 2.00% Interest every month on a Balance up to £1000 on the M Plus Current Account

Approximately 1/12 of 2% of the balance, in reality they divide the 2% by 365 (or 366 in a leap year) and then apply that to the balance at the end of each day & pay it monthly.

So you would need to look at when during the month you paid the money in, and what the interest rate was at the time. You don't get paid for a full months interest by putting the money in on the last day for example. Rates have risen on the savings account over the last year.

I don't believe they offered 2% on the linked saving back in february.

This is what their web site looked like back then...

https://web.archive.org/web/20220217182738/https://uk.virginmoney.com/current-accounts/pca/

The offer I took up was via MSE's Money Saving Newsletter as of 16th February 2022 which took me to the offer on the Virgin Money Website as below which is taken from my sign up page.

Our page at a glance

Account overview|Get started 

Things just got interesting...

M Plus Account

2.02%

Feast on a 2.02% AER1 (2.00% gross1 per annum variable) interest rate, paid monthly, on your M Plus Account balance up to £1,000.

Linked to the M Plus Saver

2.02%

AER1 (2.00% gross1 per annum variable) on savings balances up to £25,000, and 1.51% AER (1.50% gross1) on any balances above £25,000. Interest paid quarterly.

Monthly Fee

£0

There is no Monthly Fee for Maintaining the M Plus Account

The page content you have posted is from the current version of the page, which has been updated multiple times since February.

At the time the interest rate was only 0.35% on the M Plus Saver (as shown in the archived version of the page linked by @phillw).

Discussions here about an increase late in February to a (at the time) market leading 1%:

https://forums.moneysavingexpert.com/discussion/comment/79009092/#Comment_79009092