mamoon2

Question about saving accounts....

If you have an account that pays 6% interest monthly, will you get more intestest than one that pays 6% anually

So example - £1000 in a monthly paying account pays £60 per month

But £1000 in a anually paying account pays £60 per year??

Is this right??? or am i missing something????

pslewis

If you can point me to a 6% Monthly paid account - giving 72% Per Annum I would be forever in your debt!!

mamoon2

So i take it that it would be 6% per year paid monthly then??

Didn't think it made sense

pslewis

You got it

16vmarc

£60 a month would be nice!!

douglasb

I agree with Pete (for probably the second time ever )

However, if you have an account which pays interest monthly and the interest is compounded (ie you earn interest on the interest that has already been paid) then it is better to have monthly interest. Can't be arsed to work out the figures, but 6% per annum paid monthly with compound interest is better than 6% per annum paid annualy.

hades

The figures are quite simple and took me about 15 seconds to work out. 6% annual paid monthly but compounded is 0.5% /month. 1.005^12 is 1.06168. So you'd effectively get just under 6.2% rather than 6%.