Interest during year on saving account?

H

homerjk

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Hey all,

Great website and I've taken a lot of advice from it before.
Just for a bit of backstory first before my question... I'm heading around the world next September, for how long I dont know yet. I have 2.5K at the minute and I plan to save ~1k every month between now and then. Obviously I want to get the most I can out of this money so I want to set up a proper savings account.
The two I'm thinking of are the AIB Online Personal Savings Plan (because I am already with them so its not much hassle to start) and the RaboDirect 5.0% savings account.

The thing I am confused about is the interest rates and I cannot seem to get a definitive answer...:confused:
With the RaboDirect account I have read from elsewhere on this board that they pay the interest on your money at the end of the year, not sure whether this is calendar or fiscal. But what happens then if you withdraw all your savings in the middle of the year? Do you get no interest on your money from the start of the year or do they calculate it on a monthly basis?

With the AIB account I cant seem to get an answer on what happens with my starting money. If I lodge my 2.5k at the beginning do I only get interest on the 1k max lodgements I make from then on out?

If anyone could shed some light on this for me I would be very grateful. Also if anyone wants to give me advice on something better I could be doing with my money feel free!:D
Thank you.
 
homerjk said:
The two I'm thinking of are the AIB Online Personal Savings Plan
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If this is one of the c. 7% regular saver accounts then bear in mind that some of these have restrictions on access etc. EBS's regular saver account seems to be one of the less restrictive ones. See the Financial Best Buys forum for more details on this and other high rate deposit accounts.
The thing I am confused about is the interest rates and I cannot seem to get a definitive answer...:confused:
With the RaboDirect account I have read from elsewhere on this board that they pay the interest on your money at the end of the year, not sure whether this is calendar or fiscal. But what happens then if you withdraw all your savings in the middle of the year? Do you get no interest on your money from the start of the year or do they calculate it on a monthly basis?
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Check the terms & conditions but as far as I know with Rabo (and certainly with NR when you choose annual payment of interest) interest is paid pro-rata even if you close the account other than on an anniversary.
 
Hello,

You can't put a lump sum of 2.5K into the AIB online savings account to start it off. You can put a max of 1K per month into this account.The interest is calculated on a daily basis and credited to your account twice yearly at the start of April and October. However as Clubman has already pointed out, you get a pro rata amount of interest if you close early. Looking at your time scale you probably won't have the account opened even for a year to qualify for any bonus interest, The longer you leave this account running the better the interest return because of the way the bonus interest return is structured. Maybe Rabodirect might be a better option for the shorter term? I don't have a Rabo account so someone else might be better able to advise on this.
 
You would be better off puting €300 into the aib regular saver per month and the balance into the online saving in order to get a better interest rate. (your like me too lazy to bother going to some of the other institutions except for NR and rabo as it can be done online).

Enjoy the trip of a lifetime, two friends have just returned and another is heading off next week on something simular.
 
Hey Everyone, thanks for the replies. I think I will do the the two AIB account savings schemes because as you say I'm not going to be saving for that long so I'm going to go for the most straightforward option.

I'll get into all this proper savings stuff when I get back!:eek:

Cheers. J.
 
When you do go travelling you could transfer your savings to Northern Rock and go on the monthly interest rate - it would mean that you would be getting interest regularly for use during your trip.
 
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