Choosing the best savings account
The interest rate hikes seem to have slowed down for now, but there are still some great offers available on savings accounts.
Here are some things to keep in mind when choosing a savings account:
– As a general rule, many of the leading rates for online savings accounts come from financial institutions outside of the major Australian banks.
– Generally, the less access you have to your money after depositing it, the higher the interest rate. In the current market, you are likely to earn higher interest in term deposits for an extended period (but keep in mind, if interest rates go up you might miss out on higher rates).
– Your savings goals, discipline and motivation are important factors to consider when selecting an account. If you are trying to save money but you know you sometimes lack discipline, it might be a good idea to get an account that either gives you a bonus interest rate for topping up your savings (to help with your motivation) or an account that requires a bit of effort to withdraw money (rather than an instant online funds transfer).
– There are some great high-interest introductory rates on offer at the moment. If you decide to go with one of these, make sure you reassess your position once the offer is over to make sure you’re still earning a competitive rate.
– Always read the fine print and make sure the terms and conditions suit you. Watch out for interest penalties if the account drops below a certain dollar value, or if there is a limit to the number of transactions you can make.
As with everything, thorough research is the smartest way to find the best deal.