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Interest rate vs. What you get
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[Deleted User]
Posts: 0 Newbie

Hi all, I have the majority of my savings in Tandem bank which allows a 2.95% interest rate I think. I’ve just accrued £58 at the end of this month, but thought with the amount I have in there, I would’ve got more?
My initial calculations suggested I would get £1,400 a year approximately but if you multiply £58 by 12 as a rough calculation, you don’t get to that number..
Sorry for the newbie/silly post but just wanted to check. The amount I have in there is £50k
Thanks,
My initial calculations suggested I would get £1,400 a year approximately but if you multiply £58 by 12 as a rough calculation, you don’t get to that number..
Sorry for the newbie/silly post but just wanted to check. The amount I have in there is £50k
Thanks,
0
Comments
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Did you have £50,000 in that account for the whole of January?
Did the interest rate change during January?1 -
Using L and C Mortgaes Savings Interest Calulator , £50 k for a full month at 2.95 % makes £123 a month before tax or if you are a 20% tax payer it makes £98 a month.
You can t have had that amount for the full month since you deposited it .0 -
SAC2334 said:Using L and C Mortgaes Savings Interest Calulator , £50 k for a full month at 2.95 % makes £123 a month before tax or if you are a 20% tax payer it makes £98 a month.
You can t have had that amount for the full month since you deposited it .
Or if the OP earns less than £17,500, then they can also make use of the savings starter rate.2 -
Which Tandem account is offering 2.95%?
Interest is calculated daily, so your account balance at the end of each day is multiplied by the gross interest rate, then divided by 365. The daily amounts accrue and are paid gross so your tax position won’t affect the amount received.0 -
The first thing you need to do is confirm the rate of interest your account(s) is earning.1
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SAC2334 said:Using L and C Mortgaes Savings Interest Calulator , £50 k for a full month at 2.95 % makes £123 a month before tax or if you are a 20% tax payer it makes £98 a month.
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I have just had a look at the Tandem instant access account and do not see 2.95%.
The rate is shown as 2.52% gross or 2.72% gross with the 0.20% top up. If you choose monthly interest you get the gross rate, not the AER rate which is 0.03% higher to factor in annual interest compounding.
£50,000 would give the following.
£50,000 x 2.52% x 17 days / 365 = £58.68
or
£50,000 x 2.72% x 16 days / 365 = £59.62
This looks like the £50,000 was deposited on about 14th or 15th January.
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Tandem is now showing as 3.05% with the bonus so you have a good deal here Deleted_User
https://www.tandem.co.uk/products/savings
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To answer the question originally raised, the interest rate IS what you get. If your calculation doesn't give the same value then either the rate or amount is wrong in your calculation. I was expecting a regular saver question where the query about rates occurs very regularly!Remember the saying: if it looks too good to be true it almost certainly is.1
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