For cost-cutting purposes, which day is best to deposit funds onto your library book?
Taking the Livret A's interest rate cut on August 1st into account, you've got a limited window to earn the current 2.40% rate. But don't just sit back and let it slip - here's how you can optimize your gains with some tactful money moves, thanks to the fifteen-day rule.
The rate of return on Livret A is calculated by taking into account the time your cash remains in your savings account. This principle, known as "capital appreciation time," is typically expressed in 15-day periods for regulated savings accounts. Each month is divided into two 15-day periods, with the length of each period varying depending on the month. For example, a month with 31 days will have a longer 16-day period, while February has a shorter 13-day second period. Therefore, a year has 24 fifteen-day periods.
Here's the smart play to maximize your earnings: make deposits at the end of the 15-day period, either on the 15th or the 30th of the month. This way, your cash is taken into account from the start of the following period, earning you an extra 15 days of interest.
If your salary arrives toward the end of the month, tuck away a portion of it as soon as you receive it, so you can generate interest on that amount for an additional 15 days.
Pro Tips
- Timing is crucial - Deposits made before the cutoff date (15th or the end of the month) will earn interest from that date forward.
- Withdrawals after the cutoff date help maintain your balance for interest calculation purposes for the current period.
- Make deposits at the end of the 15-day period (15th or 30th) to maximize the interest accrual in the following period.
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Around this article you'll find plenty of information about Livret A, savings, interest rates, and banks.
Master the fifteen-day rule and watch your savings grow!
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Additional Insight:
The fifteen-day rule is a common practice in savings accounts like Livret A to maximize interest earnings by timing deposits and withdrawals. Interest is calculated based on daily balances but applied twice monthly (typically on the 1st and 16th or 15th and end-of-month). Deposits made before the cutoff date (e.g., the 15th or 30th) generate interest from that date onward, while withdrawals after the cutoff avoid reducing the balance used for that period's interest calculation. For example, a deposit on 14 May would earn interest from 16 May onward, while a withdrawal on 17 May would preserve interest for the first half of May.
- To optimize your gains from the Livret A savings account, make sure to deposit your funds at the end of the 15-day period, either on the 15th or the 30th of the month, so you can earn an extra 15 days of interest.
- Just like the fifteen-day rule, timing is crucial when it comes to making deposits or withdrawals from your savings account to maximize your interest accrual.
- Boost your personal-finance savings strategy with the fifteen-day rule, and watch as your earnings grow consistently over time.
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