Hi, please can someone explain how the interest works at the bank. Appreciate it may come across a bit dumb but I'm having a hard time working it out (and I have a maths brain!)

Whenever I deposit money and collect interest - the interest gained is always less than the percentage fine to withdraw the money meaning I always lose money including when I leave it awhile before withdrawing. Obviously I'm not doing it right.

Can someone give me some figures as examples so I can see where I'm going wrong? 

Thanks!

Bump!

Honestly, I have never understood the interest in the bank after 16 years and have never utilized it. So, following this xD

Yeah, I don't understand the math behind it. If you leave it in you've built up enough that it offsets it, I guess is what's supposed to happen? I just throw in what I get from the trade-in each year and try not to touch it unless I need it.

And do you think it makes money instead of a loss? I've tried leaving small amounts in there to test the theory before making a larger deposit but always seem out of pocket

hoping someone comes along soon with figures, i will probably understand more with examples 

I might test this honestly on some spares! I'll leave some money in and then withdraw all of it then bank it on sunday and see how it works! I'll check back in on this actually because personally i've never known how it works xD

IF my backwards math is correct:

You should gain .04% of whatever you have in there
It's most beneficial if you are able to put a substantial amount of money into savings

So, multiply whatever you have in savings by .04% and you should get the number of what it should make you....

for every $1,000 you should have a gain of $0.40 per week (1000 x .04%)
for every $100,000 you should gain $40 per week (100,000 x .04% and so on...)
for every $1,000,000 you should gain $400 per week
for every $100,000,000 you should gain $40,000 per week
for every $1,000,000,000 you should gain $400,000 per week

when it comes to thinking of a LOSS, you'll want to have collected x amount over time to cover the .01% you could potentially "lose" (because a withdrawal takes .05%, which is .01% higher than what you accrue weekly)

LOSS figures:

If you withdraw your $1,000 and you have only had your money in there a week and pull your $1,000: gain= 0.40, withdrawal fee on $1000 @ .05% is $0.50, so you would lose $0.10.  You can apply the math this way...

It's end of the day for me and I've been staring at and playing with numbers for 8.5 hours straight now, so it's possible that I got something wrong. Brain is tired :')

edit- should have clarified, when multiplying by .04%, you have to make sure you use the % button on the calculator. The .0004 works the same way as .04%

Thank you for replying. I kinda see it but it makes my brain hurt. Think I'll try do some working out tomorrow based on those calculations. I wonder how long you have to save for in order to not have a loss. Looking at the interest amounts listed like that, I'm not sure it's worth the faff. 

please report back whim if you do do it! 

I have all my money in the bank and collect interest every week. But I'm going to keep an eye on this thread to see if its really worth keeping it in there anymore or not.

It took me a few minutes after a very long day of work, but the interest rate is not 4%, it is 0.04%, so for anyone trying to calculate.... you will want to take the bank balance and then multiply it by 0.0004 to get the correct figure.

Multiplying by 0.04 gives you 4% of your bank balance.

Yeah, I had figured that out when I was checking whoever's above math. Because when I had multiplied their .04 with my savings total, I did not get the total that I usually get the my interest each week ($2.something mil a week). So I moved the decimal over two spaces to the left to make it a decimal and not a percent. Then I got the 2.something interest rate total.

I work percentages out a bit differently so didn't pick that up straight away. The actual amounts are still correct though - 40,000 interest per week on 100,000,000

so lets go with 500mil for example

week 1 interest = 500,200,000

week 2 = 500,400,080

week 3 = 500,600,240

if we continue this until week 12..

week 12 = 502,405,287

if I now wanted to withdraw all of it the fee would be 251,203.  This means I've made a profit of 2,154,087 in 3 months. 

feel free to tell me any of that is wrong, it's first thing in the morning before I've had any coffee. I think it's probably only worth it if you have multiple billions to leave untouched in there. If you are constantly withdrawing then it would probably make a loss. 

My brain wanted to have this as simple as possible....so here goes my attempt xD 
Edit: Now that I'm done typing....this "simple" is very long LMFAO.

Interest gained each week: 0.04% or 0.0004
Fee for pulling out funds: 0.05% or 0.0005

As long as you leave the money in there for at least 2 "collect interest" cycles, you will not be losing. You can be fancy and earn yourself some compound interest if you continue to deposit back into savings, but this really only makes a difference with large sums of money. 

From what I can tell, if you utilize the savings, it is best to keep your money in there and collect interest eack week. Then, only pull from savings when you need it, and pull few large chunks (rather than many small withdrawls), to avoid the fee. 

Deep dive in math using $100,000,000 in savings (for those mathy brains). 
- Gain = $40k per $100 mill collected each week. 
- Loss = $50k per $100 mill per withdrawl. 

----> 0 collections/weeks: Loss of $50k/100 mill immediately ($0k gained - $50k fee = $50k loss)
--------> Gain: $0k
--------> Loss: $50k
----> 1 week: Loss of $10k/100 mill from beginning. ($40k gained - $50k fee = $10k loss)
--------> Gain: $0k $40k = $40k
--------> Loss: $50k
----> 2 week: Gain/Earnings of $30k/100 mill from beginning. ($80k gained - $50k fee = $30k earned)
--------> Gain: $40k $40k = $80k
--------> Loss: $50k
----> 3 week: Gain/Earnings of $70k/100 mill from beginning. ($120k gained -$ 50k fee = $70k earned)
--------> Gain: $40k $40k $40k = $120k
--------> Loss: $50k
----> 4 week: Gain/Earnings of $110k/100 mill from beginning. ($160k gained -$ 50k fee = $110k earned)
--------> Gain: $40k $40k $40k $40k = $160k
--------> Loss: $50k
----> 5 week: Gain/Earnings of $150k/100 mill from beginning. ($200k gained -$ 50k fee = $150k earned)
--------> Gain: $40k $40k $40k $40k = $200k
--------> Loss: $50k
----> 6 week: Gain/Earnings of $190k/100 mill from beginning. ($240k gained -$ 50k fee = $150k earned)
--------> Gain: $40k $40k $40k $40k $40k = $240k
--------> Loss: $50k

Thank you for taking the time to work it out and displaying it like that. I have put all my spare money into it now and I've been saving interest weekly - it makes a lot more sense now!