For example:
Over 1 year, putting £50 a month in giving a total of £600 at 6%
Can you explain how the interest is calculated over the year?
Cheers.
It's usually worked out on the daily balance, so you'll get a month at £50 balance, then the next month on the £100 balance, the next month on £150 balance etc. In other words you get loads less than you expect!!
Depends on the account. Usually, it'll be monthly. So, on average, your balance will be £300 (i.e. starting at zero and ending at £600). 6% of £300 is £18. So , you'll get £18 of interest (plus a few pennies if the interest is paid monthly as the capital will slowly rise through the year and you'll be getting interest on the interest). But - like I say - it depends on the account, some only pay at the end of the year.
as druidh: look for "interested calculated daily, paid monthly" or "interest calculated daily, paid annually"
if it's calculated daily it's each day's balance x 6%/365.
How often it's paid will affect whether you're earning interest on what you put in, or on what you put in plus accumulated interest.
You've missed out that it's compounded if it's calculated monthly so you get interest on any previous months interest.