Hi
I just wanted to check to see if someone could help me understand how the early withdrawal fee is calculated on a Permanent TSB one year fixed deposit account.
I naively thought I would just loose the interest payable, but the figures I have been quoted by TSB are much higher than the interest I would have earned on the account even if I decided to leave the full amount on deposit for the full year?
The interest rate is .75%. Amount to be withdrawn is €36,000. The remaining term is approx 9 months.
The general t&c say
The early withdrawal charge is
(1% x Amount withdrawn x Remaining term) ÷ 365
or
an amount equal to the funding loss (if applicable), whichever is the greater.
A minimum of €20 applies.
Funding Loss is calculated using the formula (AxTxD) ÷ 365 where: A = the amount withdrawn T = the remaining term D = the difference in the prevailing market rate of interest for a term equivalent to the period remaining and the rate applicable at the date of opening the account.
Any idea where the 1% rate comes from, when the interest rate on the account is .75 gross (much less after DIRT)?
Also as I read it, I will loose the interest accrued to date on the amount withdrawn in addition to the withdrawal fee, seems very penal.
Many thanks
I just wanted to check to see if someone could help me understand how the early withdrawal fee is calculated on a Permanent TSB one year fixed deposit account.
I naively thought I would just loose the interest payable, but the figures I have been quoted by TSB are much higher than the interest I would have earned on the account even if I decided to leave the full amount on deposit for the full year?
The interest rate is .75%. Amount to be withdrawn is €36,000. The remaining term is approx 9 months.
The general t&c say
The early withdrawal charge is
(1% x Amount withdrawn x Remaining term) ÷ 365
or
an amount equal to the funding loss (if applicable), whichever is the greater.
A minimum of €20 applies.
Funding Loss is calculated using the formula (AxTxD) ÷ 365 where: A = the amount withdrawn T = the remaining term D = the difference in the prevailing market rate of interest for a term equivalent to the period remaining and the rate applicable at the date of opening the account.
Any idea where the 1% rate comes from, when the interest rate on the account is .75 gross (much less after DIRT)?
Also as I read it, I will loose the interest accrued to date on the amount withdrawn in addition to the withdrawal fee, seems very penal.
Many thanks