What is compound interest?

Compound interest is when you earn interest on the interest you’ve already earned. For example, if interest is paid back into your savings account each month, you will earn interest on this as well as on your original deposit.

How can I calculate monthly interest on savings?

To estimate the amount you could earn in interest each month, divide the annual gross rate by 12. You can then multiply this amount by your balance to see the monthly interest. If you don’t want to do the maths yourself, there are several online calculators that can help you to see how much interest you could receive on your savings. Bear in mind that any deposits, withdrawals, rate changes and the effect of compounding will affect the interest you earn.

Is my money safe in a monthly interest account?

Your money is as safe in a monthly interest account as in any other savings account. Under the Financial Services Compensation Scheme (FSCS) , up to £85,000 that you have saved with each provider (or multiple providers that share a banking licence ) is protected.

Best Monthly Interest Savings Account

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For peace of mind that your loved ones will be supported financially after you die, consider taking our life insurance. Find out more and compare policies.