Cash ISA unsure about the interest rates
I am unsure as to the difference between the two highlighted columns. Could anyone please explain? Please note that english is not my first language, and my knowlege regarding finances is limited, so if you could please, please use plain language.
1 AER stands for Annual Equivalent Rate and shows what the interest rate would be if interest was paid and added to the capital balance each year.
3 The tax-free rate is the contractual rate of interest payable where interest is exempt from income tax.
This is the url to the isa account.
PS1: I was going to go with the annual interest at 5.06, but surely it will be better the monthly interest at 5.06? I am definitely missing something here, but I do not know enough, arrrrgh
PS2: The two columns with the *3 (tax-free rate) are a bit confusing in the is scenario, as this is an ISA account, so it is already tax-free...right? maybe once i understand the difference it will make sense
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