First Active Regular Saver - 7.15% on up to €1K p.m.

TheJackal said:
Anglo's offer is for 1 year only. First Active's & many others have no end period. So less than 2 months after the year is up I'd have made more interest in the FA account than yours did in 12!
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I think you might want to check your facts there mate. Where does it say First Active's account has no end period? Last I checked it was a variable rate and can be changed as and when FA decide. Anglo's account on the other hand guarantees 3.25% over ECB until June 2009, no such guarantee with FA. Can you explain your calculation where you would make more interest? My understanding of what you said is that it would take you 14 months to make what the Anglo account makes in 12 months??

Anglo is also more flexible in that funds can be transferred manually at any date during the month and no SO or DD is required. Far better account IMHO.
 

I meant that the Anglo offer is for 12 months only then closes completely. Whereas FA might lower its rate but probably won't close it!

Calculation on CAR was roughly:
Anglo...12K (1K for 12months) @ 8% = 960
FA...12K (1K for 12 months) @7.15% = 858 + 2 further months adding 1K.
Thus: 14K @ 7.15% = 1001
 

Firstly, Anglo guarantee 8% for a whole year whereas FA guarantee nothing. FA "might" lower their rate but "probably" wont? Not exactly confidence inspiring terminology considering they "might" just as easily drop their rate tomorrow. You can be pretty certain they wont raise it anyway, at least not to 8%.

I don't think you understand how the interest on regular saver accounts work. You only earn interest on whatever sum is in the account at the time. So, month 1 earns x%*1,000/12; month 2 earns x%*2,000/12; etc. It is only in month 12 that you have the full 12k in there.

Also, you can't compare what one account earns in 12 months to what another account earns in 14 months. It is not a true comparison.

**Would just like to acknowledge my mistake in my previous post where I referred to the EBS regular saver account terms of 3.25% over ECB until June 2009, please ignore***
 
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TheJackal said:
If I put the max 1K a month into FA, at year end I'd be getting 12K @7.15% int.
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Wrong. Only the first €1K earns 7.15% the next earns 11/12ths of the annual rate, the next 10/12ths etc. 12 monthly lodgements of €1K into a 7.15% does not equate to €12K @ 7.15%! This has been covered many times already.
 
ClubMan said:
Wrong. Only the first €1K earns 7.15% the next earns 11/12ths of the annual rate, the next 10/12ths etc. 12 monthly lodgements of €1K into a 7.15% does not equate to €12K @ 7.15%! This has been covered many times already.
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Yep, my mistake Clubman & Trebor! Must have been hungover!
 
trebor said:
Also, you can't compare what one account earns in 12 months to what another account earns in 14 months. It is not a true comparison.
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I only compared 12 to 14 months because Anglo a/c closes after 12 months; FA has no end date.

I know it might be too presumptive that FA will keep its rate at 7.15% for 2 months after Anglo's a/c closes but I think it will. Just my hunch really, so went with it instead of Anglo. (Edit: emailed FA there to see how long rate is guaranteed for; will let you know what I find out)

Plus even if FA's rate falls to say 4%, 15 months after I opened it. I'd have put 15K in at this stage, so 15K@ 4% would be better staarting again with the new market leading rate of 7-8% because that a/c would only have my 1st 1K!
 
Got a reply from FA headquarters about how long the rate is guaranteed for. The girl I spoke to just fobbed me off saying it was variable, could change at any time.

She didn't say if there was a timeframe for any change to the rate, though I doubt she'd tell me if there was!
 
TheJackal said:
Got a reply from FA headquarters about how long the rate is guaranteed for. The girl I spoke to just fobbed me off saying it was variable, could change at any time.
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That's not fobbing you off. That's calling a spade a spade!
 
TheJackal said:
Got a reply from FA headquarters about how long the rate is guaranteed for. The girl I spoke to just fobbed me off saying it was variable, could change at any time.
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You actually got a reply from FA? I mailed them several times (to various contact e-mail addresses on their website) when the esaver was launched and am still waiting for a single reply!
 
What now seeing that it is closing. Will Ulster Bank take this up I wonder?
 
I see FA Regular Saver Rate has changed(dropped) again, as of today.

The rate shown now is now 5.40% AER on amounts €1 - €100,000.

Monthly amounts from €1 - €1000.

Perhaps they are going to align their rates with UB??
 
Folks, I realise this is a bit of a silly question but for someone who has been saving 1K per month into a regular saver at say 7.15% for 8 months for example, with the new rate now changing to 5.4%, can anyone show how it's possible to calculate the interest on this going forward, given the change in rates? I'm a little confused as to how to calculate it and wondering if its worth taking the balance plus what interest has been accumulated up to now and moving it all elsewhere (e.g. to a fixed rate account such as Investec's 5.58% for 6 months) or continuing on at 5.4% to accumulate more interest, given that i've already spent 8 months saving into it. Would i be losing out by stopping the regular saver now? Any info appreciated.
 
Here's a worked example for your case where I'm assuming 4 months at the new rate.

Gross Interest = (Average Principal) * AER * (Number of months AER applied for) / 12

8 months at 7.15%, Average principal = 4,000 = (0 + 8 * 1,000)/2

€190.66 = €4,000 * 0.0715 * 8/12

4 months at 5.40%, Average principal = 10,000 = 8,000 + (4 * 1,000) / 2

€180 = €10,000 * 0.054 * 4/12

Total Interest = €370.66

To work it you just break it into simpler calculations of the amount of interest that accumulated during each period the principal or AER were constant. Where the principal is changing in a predictable way averaging can be used to further reduce the number of sums.
 

To follow up on that, how would you adjust those calculations for a scenario as follows:
12 months of €1,000 at 7.15%,
13th month at 5.4%
and then 14th month at 4.9% for the forseeable future, say a further 12 months.

Pls excuse my ignorance. Tks again.
 
You want me to do all your homework for you?

Here's a further example of what I illustrated above for each period a different rate applied.

Assuming that interest is paid at the end of months 12 and 24.

Interest for months 1 - 12, €429 = €12,000/2 * 0.0715 * 12/12

Interest for month 13, €60 = (12,429 + €1000) * 0.054 * 1/12

Interest for months 14 - 24, €850 = (13,429 + (0 + 11 * 1000)/2) * 0.049 * 11/12

Total interest over 24 months is €1339
 

Tks GeneralZod, I thought that was how it should be done but I just wanted to be sure (a likely story he says, but true). Cheers.
 
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