I was under the impression that ING were unmatched for the straightforward fair-deal - I know there are better rates but these seem usually to be limited and on special offer (e.g. Cahoot - max 50k and no longer available). But Nationwide e-savings are currently paying the same 5% as ING with immediate access. Does anyone have any insight as to how likely Nationwide are to maintain this parity?
Nationwide have been 0.25% above base for long enough. ING's rate has been slipping down relative to base rate.
My guess is you are probably better off with Nationwide.
And why they de-mutialise, you'll get a big stack of cash/shares.
No you won't. I'm fairly sure it's one of Nationwide's T&Cs that you agree to give any benefits from de-mutualisation to charity or some such. I think it's to stop the shareholders voting en-mass for demutualisation, just to get their hands on some dosh.
Andy
The finance & sales directors of Nationwide might know.
Is that the case? So Nationwide were at 5% before ING?
maybe
The carpetbaggers (I was one myself in the early days of mass-mutualisation) got in before the deadline (somewhere round 1999/2000?). New accounts did require that condition but a sizeable proportion are still holding Nationwide accounts/mortgages without having made this promise.
well I never
1997.
If it was going to happen it would have happened by now. Nationwide members have consistently voted against carpetbaggers standing for the board. As time passes an even greater percentange of members will have nothing to gain from demutualisation, so the only way it's ever going to happen is if the "promise" new members have to sign is declared invalid legally. I think one of the carpetbaggers tried this and failed.
Looking at the Nationwide website, it appears that interest is paid ANNUALLY. There is no mention of how it is calculated either, but being paid annually, you would loose out on compound interest - unless i'm missing something here.
Aris
"Andy Hawkins" wrote
What shareholders?
Sorry, wrong term. Is 'members' more appropriate? The people that are entitle to vote for such things in a Building Society.
Andy
I wasn't speculating on the likelyhood, merely addressing the fact of a significant horde who are not disinterested.
Can somebody clarify this? As far as I can remember ING add interest quarterly
- at a guess I would think this makes little difference. But if anyone has the sums....
In fact ING pay interest monthly. They issue quarterly "statements". But of course 5% is their stated AER, not their contract rate. That's
4.89% gross per year, or 0.326% net per month, which works out at an effective 4.98% per year gross, rounded up to 5% for the glossies.
So, apart from the joylessness of not seeing the money grow on the nationwide monthly statement - there's no significant difference in the pay-out over 12 months?
I'm sure you'll have explained this before but could you clarify? If you've stuck £100 in Nationwide at a declared 5% gross per year and you leave the money there for 67 days are they calculating daily on x% where (1+x/100)^365 = 1.05? OR interest =(67/365) x 5%?
(or neither?)
In message , nervous wrote
ING pay monthly but the quoted rate is an annual rate.
It makes a difference if you want to reinvest it without closing the account.
cd
If you are a non tax payer, and you pay £1000 into Nationwide on 1st Jan [1]
then on 31st December, you get interest of £50.
If you are a tax payer, you still get £50, but have £10 tax deducted, leaving you with £40.
If you are a non tax payer, and pay £1000 into ING on 1st Jan [1]
then the figures look something like this
b/fwd interest
Jan 1000.00 4.07 Feb 1004.07 4.09 Mar 1008.16 4.11 Apr 1012.27 4.12 May 1016.39 4.14 Jun 1020.53 4.16 Jul 1024.69 4.17 Aug 1028.86 4.19 Sep 1033.05 4.21 Oct 1037.26 4.23 Nov 1041.49 4.25 Dec 1045.74 4.26 Jan 1050.00
So it makes no difference either way.
If you are a tax payer, then
b/fwd interest tax
Jan 1000.00 4.07 0.81 Feb 1003.26 4.09 0.82 Mar 1006.53 4.10 0.82 Apr 1009.81 4.11 0.82 May 1013.10 4.13 0.83 Jun 1016.40 4.14 0.83 Jul 1019.72 4.15 0.83 Aug 1023.04 4.17 0.83 Sep 1026.37 4.18 0.84 Oct 1029.72 4.20 0.84 Nov 1033.08 4.21 0.84 Dec 1036.44 4.22 0.84 Jan 1039.82
So you would be 18p better off by having annual interest rather than monthly interest
[1] For the purposes of this illustration, 1st Jan is not a bank holiday The interest rate does not change during the year
When the base rate was 4.5%, Nationwide was 4.75% and ING was 4.85%. I think Nationwide may have raised the rate a bit earlier than ING.
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