Regular saver vs lump sum (& dirt question)

petergdub

I don't understand how regular saver accounts get much higher rate of interest than lump sums.
e.g. AIB regular saver (300 / month max) pays about 5% while the best lump sum rate is 3 odd percent.
Where is the catch with these regular saver accounts ?
Surely the monthly amounts dont always receive the beneficial rate.

Also is anyone exploiting these so called parent saver / family accounts which appear to dodge DIRT if the named child is under a certain age.

Toots

You'll generally find that the higher rate only applies to the first €5000 (or other set amount) saved, any balances over that usually earn a lower rate.

stepbar

petergdub wrote: »

I don't understand how regular saver accounts get much higher rate of interest than lump sums.
e.g. AIB regular saver (300 / month max) pays about 5% while the best lump sum rate is 3 odd percent.
Where is the catch with these regular saver accounts ?
Surely the monthly amounts dont always receive the beneficial rate.

Also is anyone exploiting these so called parent saver / family accounts which appear to dodge DIRT if the named child is under a certain age.

It's 5% on each monthly lodgement and the balance already in the account (if any). i.e Your first lodgement (lets say 300 eur) attracts a rate of 5% for the month. The next lodgement brings the total balance to 600 eur and the interest accumulates based on a rate of 5% for the month and so on. Interest is then paid out and added to the principle at the time.

RE: DIRT - this is not true. Link