Regular Savings accounts

HopefullyThisWorks

To open a Regular Savings Account, i.e.First Direct - 7% Fixed..... is there a limit to how much I can open with?
Also, would I get the interest rate on the entire account or just the savings I put in, how exactly does it work?

Katiehound

A regular Savings account has a maximum amount that you can put in each month. Each RS will stipulate what that is (and probably a minimum sum too.)

I'm not sure what you mean by 'do I get the interest rate on the entire account?'

Whatever you put into the RS earns interest each month but of course you only get ,say 7%, on the money actually
deposited, not 7% on the final total for a whole year.
For example- month 1- £200 deposited- that will earn interest for a year
                       month 2- £200 deposited- £400 earns interest for 11 months and so on.....

Someone else will probably come along to tell you the exact figures.......

WillPS

HopefullyThisWorks said:

To open a Regular Savings Account, i.e.First Direct - 7% Fixed..... is there a limit to how much I can open with?
Also, would I get the interest rate on the entire account or just the savings I put in, how exactly does it work?

Yes, there is a limit equal to the monthly limit - in the case of First Direct's saver, that's £300.

Many regular savers also have a minimum monthly amount and/or a minimum opening balance. In the case of First Direct the minimum monthly deposit is £25.

Stargunner

You can only pay in a max of £300 per month to the First Direct RS. The 7% interest is only paid on these deposits.

AmityNeon

HopefullyThisWorks said:

To open a Regular Savings Account, i.e.First Direct - 7% Fixed..... is there a limit to how much I can open with?

Also, would I get the interest rate on the entire account or just the savings I put in, how exactly does it work?

Like any other savings account, the annual rate of gross interest (in this case 7.00%) is calculated daily on the closing account balance (i.e. the end-of-day balance that can no longer change for interest calculation), so divide the interest rate by 365 and multiply the result by however much money is in the account at the end of the each day.

Regular Savings Accounts have maximum monthly deposit restrictions (in this case £300), which is why they typically have higher interest rates; providers can limit the amount of interest they pay while still publishing an attractive headline rate. (Some accounts also have minimum monthly deposit requirements.)

(7.00% ÷ 365) × £300 = 0.0575 (just less than 6p per day in the first month).

Daily interest is not rounded until accrued interest is paid (annually in this case, but some accounts pay interest monthly).

jameseonline

https://www.moneysavingexpert.com/savings/best-regular-savings-accounts/ might help you with things

35har1old

HopefullyThisWorks said:

To open a Regular Savings Account, i.e.First Direct - 7% Fixed..... is there a limit to how much I can open with?
Also, would I get the interest rate on the entire account or just the savings I put in, how exactly does it work?

Needs to be kept for the year if you close early interest rate drops to standard rate

HopefullyThisWorks

Thanks for all your comments, much appreciated.
What I meant was.... do you open the account with a lump sum and then add your monthly RS to it thereafter. From your replies it seems that you don't. 

t1redmonkey

HopefullyThisWorks said:

Thanks for all your comments, much appreciated.
What I meant was.... do you open the account with a lump sum and then add your monthly RS to it thereafter. From your replies it seems that you don't. 

Well you do generally have to deposit a lump sum to start off a Regular Saver yes (or set up a standing order), but that will be limited to whatever the monthly pay in limit is.  

The one you were first asking about (First Direct) I believe is one where you can only fund it via standing order from your FD current account.  You can't for example, pay in a lump sum of £10k to start it off if that's what you're asking, the opening amount is limited to the monthly maximum pay in (£300).

surreysaver

HopefullyThisWorks said:

Thanks for all your comments, much appreciated.
What I meant was.... do you open the account with a lump sum and then add your monthly RS to it thereafter. From your replies it seems that you don't. 

You can open it with a lump sum of up to £300, as that is the maximum you can pay in each month 

jameseonline

Lump sum is an interesting phrase but you open a regular saver with at least the minimum amount possible up to the maximum possible.