Maths question

mta999

I have £2400 in an instant access savings accounts with a bank

This instant access account pays 1%

If I open a Regular Saver at the bank which pays 6% and transfer £200 a month over am I right in thinking that my interest rate on my £2400 will be (6+1)/2=3.5%

Assume I will pay all 12 payments across to the regular saver over the year

la531983

You could transfer the £2400 into an account and get over 4% on it straight away, plenty of them out there

masonic

To a first approximation, yes. Usually it will be a bit better than this, as with accounts operating on a calendar month basis you can revert to the 1st of each month for subsequent deposits.

eskbanker

Play around with numbers at https://www.moneysavingexpert.com/savings/regular-savings-calculator/

Barkin

https://forums.moneysavingexpert.com/discussion/6663959/maths-question

Yes, you'd make £80-odd interest, so equivalent to 3.5% - ish.

If you moved the £2400 to an account paying 4% first, and did the same - £200/month into a 6% regular saver, you'd get £120 odd interest.

surreysaver

https://forums.moneysavingexpert.com/discussion/comment/81961134#Comment_81961134

Or even better, transfer it to an easy access paying over 4% and transfer £200pm from there to the regular saver.

Cahoot pay 5% on up to £3k

friolento

I'd put my £2,400 into the 6% Santander Edge Saver as a lump sum. £144 interest.

mta999

Thanks everyone. I have 4% accounts etc elsewhere but this is specific.

I want an instant access account with a couple of thousand in it at my High St bank where my current account is

Their instant access account pays 1% but their regular saver 6% with instant access

This was my way of having instant access to 2.4k at my bank but getting 3.5%

winkowinko

What's the need for having 2 accounts with the same institution?

You are penalising yourself quite heavily.

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/81961276#Comment_81961276

It is convenient. I also keep a few thousand in my current account providers easy access account, as I can transfer money in seconds both ways, at the same time I am doing other things on the app. However mine pays 3% so less of an issue.

etienneg

These days, with app or online web access, and as long as you use financial institutions that pay transfers immediately (rather than smaller building societies that pay by issuing instructions to their bank in batches for next day payment) you can transfer between institutions as fast as between accounts at the same institution. So why do you need savings (easy access or regular savings) and current account with the same institution?