Interest On Savings

[maksoud]

My mum has about 12000 GBP and would like to put them in an account to earn interest on them that she can withdraw monthly. She used to have an account before that earned 40GBP monthly. Does anyone know what kind of account she should open and in which bank with good rates? It's important that she can withdraw it monthly.

[ladybirder]

Have a look here maksoud.

http://moneyfacts.co.uk/savings/high-interest-savings-account/

[New Judge]

£40 per month is 4%. That is virtually impossible to achieve at present.

She could open a Santander 123 current account which pays 3% on balances up to £20k. The interest is added and can be drawn monthly. Three downsides:

She must pay in £500 per month (but this can come from another account and can be immediately reversed)

She must have two activer Direct Debits from the account.

There is a £5 monthly charge.

This makes the monthly net income £25.

[mikey4444]

NJ....Hardly worth it I would have thought....all that faffing about for £25:00
a month !

[fiction-factory]

The Santander123 pays only 1.5% now.

[fiction-factory]

Tesco still pays 3% on a current account on balances up to £3000, but you can have more than one account. The MSE site is the best pace to look. To maximise interest you need to spread it around the best deals which tend to have low limits and you may decide it's not worth the trouble. When rates are so low it may be worth using Santander and then getting an income drawing down on the capital- if she withdrew £50 or £100 a month her capital would not fall much over the year and she could do this for the next 10-20 years

[New Judge]

Yes, thanks f-f. I'd forgotten that. So £10.00 month then. Even less for all that faffing about!! :-)

[ChesterInvestor]

She could invest in a monthly income fund. Some of these might be able to return 3-4% all being well. She'd probably have to withdraw the money though, if in a stocks and shares ISA. Other than that bonds and P2P are unlikely to pay out on a monthly basis in my experience.

Source used: https://www.best-savings-rate.co.uk/news/where-invest-monthly-income/