Savings interest monthly vs annual

eskbanker

david72 said:

There is also the (small) risk that the bank may go bust, and although the FSCS would repay your money, would it pay you the interest that should have been due on an account that only paid annual interest, or would you lose that? (Genuine question: I don't know.)

FSCS compensation includes interest accrued but unpaid up to the date of insolvency:

https://www.gov.uk/hmrc-internal-manuals/savings-and-investment-manual/saim2085

masonic

david72 said:

Personally, I'd rather that my interest was in my grubby pocket as soon as possible, rather than the bank's!

If you are just going to leave it in the savings account, then I fail to see the difference. Fair enough if you have it paid away and spend it.

Swipe

david72 said:

There is also the (small) risk that the bank may go bust, and although the FSCS would repay your money, would it pay you the interest that should have been due on an account that only paid annual interest, or would you lose that? (Genuine question: I don't know.)

When Icesave Icelandic bank went under and the UK Govt bailed us out I got all my money back including the interest owed. I would therefore assume the same would happen under the FCSC compensation scheme.

Edit: I see it has already been answered.

Qyburn

One reason for choosing might be to determine which tax year the interest falls into. 

jaceyboy

Monthly for me

metrobus

Qyburn said:

One reason for choosing might be to determine which tax year the interest falls into. 

And that is where being able to change mid term becomes a real bonus, if you only want 1 months interest credited to you in one particular financial year and the rest in the next tax year.