Interest rate calculation!

[Scarlett]

Can any clever person tell me .. if I sold my house I would make a profit of �90,000. If I kept this in a savings account of as high interest as possible, how much interest would it earn per month? ie- if I wanted to try and spend only the interest and leave the rest in tact.

Many thanks

[Loosehead]

OK you can earn at least 5.75% so I'll use that.

(5.75*90000/100)/12 = 431.25 per month before tax, net -�345. However you may be subject to further tax later if you reash the 40% threshold.

[DillyGent]

Scarlett, I did exactly that. I have the proceeds of the sale of my property with Alliance & Leicester Direct Saver. �95,000 brings me �387 per month. If I draw on any of the capital though I will not get the interest that month - instant access and you cannot hold more than �100,000 in that account. Enjoy!