Most people doing bank switching or stoozing have no idea what they're actually earning. They see a £200 bonus land in their account and think "brilliant, that's my return". They leave £3,000 on a 0% card earning interest and assume it's all profit. They open three regular saver accounts and can't work out which is the best deal.
The numbers look good on paper, but the maths is where most people go wrong. And getting the maths wrong doesn't just mean you can't brag about your returns — it means you're probably leaving money on the table or picking worse strategies than you think.
Let me walk you through how to actually calculate what you're earning from banking, where the mistakes happen, and how to make sure you're getting the best return on your time and effort.
The Simple Case: Bank Switching Bonuses
This is where most people start, and it's reassuringly straightforward. You switch to a new bank, they give you a bonus, that's your profit.
If you switch to three banks and get £200 bonuses from each, your total earnings are £600. Done.
But here's the catch: they never actually cost you anything to switch, so the bonus is pure profit. The only cost is your time — typically 15–30 minutes per switch if you use the automated switching service. At London minimum wage rates, that's about £6–12 per switch. So your real return on three switches is £600 minus (let's say) £10 per switch = £570 for 90 minutes of work. That's £380 per hour.
Sounds good? It is. But this is why so many people do it.
The calculation is simple: bonus received minus time cost equals your return. For bonus tracking, just add them up as they land.
The Trickier Case: Stoozing Interest
This is where people get confused. You put £3,000 on a 0% credit card and it sits there earning interest in your savings account. How much interest do you actually make?
The formula depends on two things: how much money, and for how long.
Let's say you put £3,000 on a 0% card. You keep it in a savings account earning 4% annually (realistic for 2026). The card's 0% period lasts 18 months.
Simple interest (less common, but easier to calculate):
- Interest earned = (Amount × Annual Rate × Time in Years)
- Interest = £3,000 × 0.04 × 1.5 = £180
That's your profit on that stooze.
But most savings accounts compound monthly. That means you earn interest on your interest.
Compound interest (more realistic):
- Final Amount = Amount × (1 + Rate/Periods)^(Periods × Years)
- Final Amount = £3,000 × (1 + 0.04/12)^(12 × 1.5)
- Final Amount = £3,000 × (1.00333)^18
- Final Amount = £3,000 × 1.0618
- Final Amount = £3,185.40
- Interest earned = £185.40
That extra £5.40 is compound interest — you earned interest on your interest. Small with this example, but it compounds over longer periods or higher amounts.
The common mistake: People assume their interest is from their savings account earning 4%. It is. But they don't account for the fact that a 0% card's 0% period ends, and when it does, interest kicks in hard. If you're stoozing on a card and haven't paid off the balance by the time the 0% ends, suddenly you're paying 18–22% interest on whatever's left. That wipes out your profits instantly.
This is why how stoozing works emphasises paying off the full balance before the 0% ends.
Another mistake: People compare stoozing returns to savings accounts as if they're equivalent. They're not. Stoozing earnings are taxable as interest (unless in an ISA). A savings account at 4% that earns you £180 will cost you roughly £36 in tax (basic rate). A stooze earning you £180 also costs you that tax. They're the same for tax purposes, so compare them directly — but don't forget to factor in the tax hit.
Regular Saver Compound Interest
Regular savers are advertised with headline rates like "7%". That sounds amazing. But how much do you actually earn?
The trick is that interest compounds monthly, and you're adding money monthly. Most regular savers let you deposit between £50–£500 per month.
Let's say you deposit £200 monthly into a 7% regular saver for 12 months. How much interest?
This is complicated because each monthly deposit earns interest for a different length of time:
- Your January deposit earns interest for 12 months
- Your February deposit earns interest for 11 months
- Your March deposit earns interest for 10 months
- ... and so on
The maths: for each deposit, calculate compound interest, then sum them all up.
Simplified calculation for equal monthly deposits: Interest = (Monthly Deposit × Rate × Average Time) + (compound effect)
For most regular savers with 7% annual rate and £200 monthly deposits:
- Month 1: £200 at 7% for 12 months = approx £14 interest
- Month 2: £200 at 7% for 11 months = approx £12.83 interest
- Month 3: £200 at 7% for 10 months = approx £11.67 interest
- ... (continuing this pattern)
- Total after 12 months: approx £152–160 interest
On £2,400 deposited (12 × £200), that's roughly 6.3–6.7% actual return, not 7%.
Why? Because the headline 7% is the annual percentage rate if that full amount earned interest for a full year. But you're adding money gradually, so the average amount in the account is much lower than the final balance.
The key insight: Regular savers give you compounding, but also account for the fact you're building the balance over time. The actual interest you earn is typically 80–90% of the headline rate, depending on when you make deposits and how the account compounds.
Combining Strategies: The Real Picture
Here's where most people lose track. You're running three regular savers, two stoozes, and three switching bonuses coming in. What's your actual return?
Let's say:
- Bank switches: Three £200 bonuses = £600 (time cost ~£30, net £570)
- Stooze 1: £5,000 at 4% for 9 months = approx £150 interest
- Stooze 2: £2,000 at 4% for 6 months = approx £40 interest
- Regular Saver 1: £300/month at 7% for 12 months = approx £240 interest (actual, not headline)
- Regular Saver 2: £200/month at 6.5% for 12 months = approx £130 interest
- Regular Saver 3: £100/month at 5.5% for 12 months = approx £45 interest
Total gross earnings: £1,175
Before tax. You'll owe income tax on the interest portion (£450 across the stoozes and savers). If you're a basic-rate taxpayer, that's roughly £90. Higher rate? £180.
After tax: £1,085–1,095 net earnings
For how much work? Opening three current accounts (90 minutes), setting up three regular savers (60 minutes), moving money between cards and savings accounts monthly (maybe 20 minutes per month × 12 = 240 minutes). Total: roughly 6.5 hours of work across the year.
Effective hourly rate: £167–168/hour (net of tax)
That's the real number. And it only works if:
- You actually withdraw money before 0% periods end
- You maintain your regular saver deposits consistently
- You don't accidentally trigger overdraft fees or miss payment dates
- You stick to your plan
How to Track Your Returns Properly
Use a spreadsheet. I know that sounds tedious, but it's essential.
Columns you need:
- Account name
- Opening date
- Deposit amount (and monthly deposits for savers)
- Interest rate (actual, not headline)
- Interest earned (actual, month by month)
- Withdrawal date (if applicable)
- Total interest earned
- Tax paid
- Net return
Update it monthly. It takes 10 minutes. At the end of the year, you know your exact earnings, your hourly rate, and whether you're better off doing this or putting the money in a fixed-rate savings bond.
Alternatively, use the stoozing calculator for individual stoozes, and track bonuses separately.
Common Calculation Mistakes
Mistake 1: Forgetting about tax. Interest income is taxable unless it's in an ISA. Basic-rate taxpayers have a £1,000 Personal Savings Allowance, so your first £1,000 of interest is tax-free. After that, you pay 20%. Higher-rate taxpayers get £500 tax-free; additional-rate get nothing. Most people doing serious banking will exceed their allowance.
Mistake 2: Treating bonus and interest earnings the same. Bank switching bonuses aren't interest income, so they're not taxable. Interest on stoozes and regular savers is. They're different tax buckets.
Mistake 3: Ignoring time cost. If you spend 10 hours a year on banking strategy, and earn £1,000, you're at £100/hour gross. Is that worth your time? Probably yes, but only if you know the real number.
Mistake 4: Assuming regular saver rates are guaranteed. They aren't. Some banks reduce rates mid-year. Check the terms, and be ready to switch if rates drop significantly.
Mistake 5: Not accounting for required balances. Some banks require a minimum balance on your current account to get the switching bonus. If you have to keep £2,000 in a 0% current account, that's money not earning interest elsewhere. Factor it into your return calculations.
Getting the Right Data
You need actual interest rates, not headlines. Check live offers for current rates on switching bonuses. For savings rates, use best savings rates and plug the exact rate into your calculations.
For tax calculations, refer to HMRC guidance on interest income, or use an online tax calculator. Record everything you earn in your self-assessment (if you're self-employed) or on your tax return (if employed).
Common Questions
Do I need to track everything to the penny? No. Monthly tracking is accurate enough. You'll be within £1–2 of the exact figure, and that precision isn't worth the extra effort.
What if I earn more than my Personal Savings Allowance? You'll pay tax on the excess. Basic-rate taxpayers at £1,250 earned pay tax on £250, which is £50. Factor this into your calculations.
Should I keep stoozing if interest rates drop? Only if you're earning more from stoozing than you would from a savings account. If savings rates hit 3% and stoozing interest is at 2%, stoozing doesn't make sense. Use rate-lag tracker to monitor trends.
Can I earn more from a single regular saver than three regular savers with the same total monthly deposit? Not necessarily. One £300/month saver might have a better rate than three £100/month savers. Check best regular-saver ladder for rate comparison, but calculate the actual interest for your specific deposits.
Is my ISA interest rate better than my stoozing earnings? Compare the math directly. ISA interest is tax-free; stoozing interest is taxable. If you're earning 4% in an ISA, that's equivalent to 5% taxable interest (basic rate). Calculate both, compare them, pick the better option.