# Compound interest accounts?



## astrosaver (20 May 2008)

In the sticky BestBuys could you summarise who/where you can
get savings accounts which offer compounding interest rates?

I thought FA did one, but they don't.
Do any of the major banks offer fixed/flexible deposit accounts offering
compound interest?

I know of the Irish Forestry investment plan. They offer 8.2% compounded
over 12 years. Excellent.

Any banks offering similar?


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## DrMoriarty (20 May 2008)

Welcome to AAM, astrosaver. In keeping with the , could you confirm whether you have any connection to the Irish Forestry investment plan?


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## Protocol (20 May 2008)

I would have thought that all Irish bank accounts pay interest compounded.

Don't they?


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## DrMoriarty (20 May 2008)

Me too. I find the question curious. Hopefully the OP will clarify?


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## TSThomas (20 May 2008)

Well, ummm, no, they don't. To quote the Offering Document (emphasis mine!);

_*Based on *the key __*assumptions *set out on Page 15 of this Offering Document the Preference Shareholders __should receive a distribution of 8.2% per annum compound on their original investment in twelve years time. __*Assuming Inflation to average 3.5% per annum, this equates to a **real rate of **return (i.e. net of Inflation) **of 4.7% per annum*. Whilst The Company has taken care to ensure that the assumptions used are reasonable based on historical trends and current forest management practice, past performance may not be a reliable guide to future performance. Future events and circumstances may cause actual results to vary from those projected._

Toss in taxation liability as with any other investment too.

I'm not sure what you mean by listing accounts that offer compounding interest rates either, are there any that don't?


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## astrosaver (20 May 2008)

I've nothing to do with the forestry plan.
I'm quite new to the whole savings game, and am just looking for somewhere to invest spare cash from my paycheck, or put a few grand in an account which will make the money grow. 

I thought banks did compound interest on their savings accounts, but
maybe I'm missing something, as I was in First Active, asking about
their regular savings account, which pays 7.15 % but you don't earn
interest on the interest. The guy said most other savings accounts, are
not compound interest. So even if I put in 500 euro per month, at the
end of 12 months, the guys said I would only earn 42 euro interest. 

I wish I knew how they calculated these things.


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## ClubMan (21 May 2008)

astrosaver said:


> I know of the Irish Forestry investment plan. They offer 8.2% compounded


No they don't. That is simply a projected figure which is basically meaningless. Who knows what actual performance will be? Nobody. And you capital is not guaranteed. Comparing this to a deposit account is comparing apples with lemons. If you are new to savings/investing and need to learn more before putting your money somewhere then stick it in a high yielding deposit account and then read the key posts here on _AAM _and the consumer guides on www.itsyourmoney.ie .


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