When to change savings accounts?

David333

I have some money in a Zopa account, but can get more interest elsewhere. However, I am thinking about when to transfer. Will I miss out on a period of interest? So, for example, if I transfer on the 20th of the month and Zopa interest is paid in on the 31st. Will Zopa not pay me any interest for that month, and then a new provider not pay interest until the end of the next month, with the result that I lose a month's interest?

VXman

Most savings accounts providers will calculate interest on a daily basis so it shouldn't make any difference. The interest is added monthly (or annually in some cases) but it doesn't matter what day you move or open an account. 

phillw

I'd avoid weekends, bank holidays or evenings. As you can find that either the bank you are withdrawing from or depositing to will sit on the money while it's not earning interest.

If we knew when all the cut off times were for all the savings accounts then we could get double interest. For example if the account with your money is 4pm and another is 5pm, you could transfer money between 4pm & 5pm and back after 5pm each day. For obvious reasons they don't tell you this, so it's best to avoid as you could end up going the other way and missing a days interest (I think in general they have been moving towards midnight).

When in the month is less important, but remember to log back into zopa to withdraw the interest after it's been paid.

Band7

VXman said:

Most savings accounts providers will calculate interest on a daily basis so it shouldn't make any difference. The interest is added monthly (or annually in some cases) but it doesn't matter what day you move or open an account. 

All savings providers calculate interest on a daily basis, i.e. for the balance you have in the account at the end of a day.

Unless the T&Cs of an account stipulate an interest penalty for withdrawals, you get all the interest you have accrued up to the date of withdrawal.

Whether you get the accrued interest on the date of withdrawal or at the next regular payment date depends on how you withdraw. If you close an account, the interest gets paid at closure. If you just withdraw the entire balance but leave the account open, you get the interest when it is next due. In the case of the Zopa Smartsaver, I believe interest is paid on the monthiversary of your account opening. Obvsly you can't withdraw from one of their Notice accounts until the notice period is up.

TiVo_Lad

Band7 said:

If you close an account, the interest gets paid at closure. If you just withdraw the entire balance but leave the account open, you get the interest when it is next due.

This also applies to the Zopa Pots. Close it and the interest gets paid immediately, but leave it open with zero balance and you get the interest on the next monthly interest payment date.

David333

This is all really helpful. Essentially it seems that I won't lose any interest (although best to avoid bank holidays, etc), but I just need to keep track of where it is. Thanks all!