Discussion
All the information online tells me AER pays more than APR, yet my ISA which is AER is calculated daily but added yearly which appears to compound once a year.
Yet my mortgage is APR and goes up daily so compounds everyday.
The facts seem to point towards APR paying more than AER.
I was wondering if an ISA at 3.1% is worth keeping or should i just throw the lot into the mortgage at 2.69%. I'll be doing that when it matures anyway. However by my calcs I just get a smidge more interest in the ISA (£90) but only due to the repayments - if i just calculated it off interest only then the daily compounding effect wipes out the annual addition.
So is the "AER pays more than APR" actually a load of rubbish?
Yet my mortgage is APR and goes up daily so compounds everyday.
The facts seem to point towards APR paying more than AER.
I was wondering if an ISA at 3.1% is worth keeping or should i just throw the lot into the mortgage at 2.69%. I'll be doing that when it matures anyway. However by my calcs I just get a smidge more interest in the ISA (£90) but only due to the repayments - if i just calculated it off interest only then the daily compounding effect wipes out the annual addition.
So is the "AER pays more than APR" actually a load of rubbish?
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