Icesave to Kaupthing Edge (Calculating Int)

msaquib

Hi,

I currently have £24679 in my ICESAVE account which is paying 6.05 AER. The last interest they paid me was £114.

If I transfer the whole amount to Kaupthing Edge at the rate of 6.50 what will be the montlhly interest?

Also is there any simpler way to transferring the money? without loosing much interest in BACS process.

Thanks
MS

Geoffo_M

Interest is calculated daily so for May, you would be credited with roughly £132 (ie £24,679 x 6.31% / 365 x 31). Interest is compounded so for June your new balance would be £24,811 which times 6.31% for 30 days is around £129. The Aer is 6.5% - that is if you add up all the monthly interest credits (which will be increasing as it becomes compounded) and express it as a % of initial deposit of £24,679 it is 6.5%.

YorkshireBoy

If I transfer the whole amount to Kaupthing Edge at the rate of 6.50 what will be the montlhly interest?

For a static balance, monthly interest is calculated as...

balance x gross p.a. rate / 365 x n x 0.8

where n = number of days in the month, and
0.8 is the savings tax multiplier (ignore if you get your interest gross).

For a 31 day month...

£24,679 x 6.31% / 365 x 31 x 0.8 = £105.81 (£132.26 gross)

Also is there any simpler way to transferring the money? without loosing much interest in BACS process.

IceSave offer a CHAPS facility, but at £30 it's unlikely to save you money (over a few days lost interest in the BACS ether) on your current balance.

May be better to BACS it to your linked account, park it in a linked savings account over the weekend, and then BACS it/DD pull it into Kaupthing the following week?

chesky369

Why don't you transfer some of it to either the ICEsave 6-month or one year saver - can't remember the 6 month currently (even though I have two of them at slightly differing amounts) but the one year is at 7.01%.