How to find the best savings account in Australia

Comparing Savings Accounts:

Your InfoChoice Guide to Savings Accounts, January 2020

Looking for your best savings account means not just jumping at the highest rate because the best account for has rules and conditions that match your way of spending and saving.

An introductory rate savings account might be best for you if:

  • You will need your money soon and just a place to keep it for a while
  • You’re new to savings
  • You need to make withdrawals
  • You’re willing to look for another account once the introductory period is over.

An example of a top market-leading Introductory-rate saving account is:

Citi’s Online Saver account is currently paying 2.30 per cent pa for four months, then reverting to a base rate of 0.85 per cent pa. (terms, conditions and limits apply).

An incentive saver account might be best for you if:

  • You’re an experienced saver
  • You’re confident you won’t make any withdrawals
  • You can make regular deposits, and
  • You appreciate any incentive rates on offer.

An example of a top market-leading Incentive Saver saving account is:

ME’s Online Savings Account (with ongoing bonus) is currently paying a maximum bonus rate of 2.05 per cent pa when you make at least one tap n go payment using a linked ME transaction account each week. (other terms & conditions may apply).

You can start your search for a savings account on a reliable comparison site; take your time and really think about what your aims are before settling on one product.

A term deposit account might be best for you if:

If you don’t want to move any money in or out, you might prefer a term deposit. Some market-leading term deposit rates are currently being offered by Judo Bank.

A Notice Saver Account might be best for you if:

If you can afford to leave your money in an account that only allows you withdraw it with at least one-months notice, you might be interested in reading more about notice saver accounts.

RaboBank has notice saver accounts starting at 31-day notice periods. RaboBank also has a top market-leading introductory rate savings account – The RaboBank Online Savings High Interest Savings Account currently paying a maximum rate for four months of 2.50 per cent, then falling back to a base rate of 1.05 per cent pa.

How to make your savings account work for you

Australian savers link their savings account to an everyday account to move money in and out. You can link to an account with the same bank or credit union or another institution. Different banks have their own rules about this.

What is the difference between a savings account and a transaction account?

Transaction accounts are sometimes called savings accounts, like on ATM or Eftpos terminal buttons.

But a savings account is actually very different from an everyday transaction banking account.

You can’t use a savings account for direct debits, BPay, paying people or bills or making purchases instore or online. You can transfer money in and out from your linked transaction account.

An everyday transaction account might feature Apple Pay, Google Pay, Eftpos, a Mastercard or Visa debit card, BPay and other services.

What to look for in a savings account

There are lots of great saving accounts available to Australian savers. You need to know what you’re looking for and what the various features will do for you first, so that you can find the one that’s best for you and your needs.

Low opening deposits

Most savings accounts have no minimum opening deposit, so you can get started with one dollar or even nothing. Many of these accounts don’t have a minimum monthly deposit either, although your interest rate might be on the low side.

However, look out for accounts that only pay the maximum bonus rate to balances over a minimum level, like $1,000 or $10,000.

No monthly fees

Savings accounts in Australia do not charge fees. Do not pay fees on your savings account. If you are asked for fees you might be getting scammed.

Your money will grow without much effort on your part

All you need to do is open the account and make at least one deposit. All savers will earn you some interest, even if it’s not much. As with most things in life, however, the more you put in, the more you get out.

You can transfer funds easily

Once you’ve linked your saver and your transaction accounts, you can move money between them with just a few clicks. Remember, try to keep it one way!

What to look out for with savings accounts

Not meeting the minimum monthly requirements

If you can’t make the minimum deposit required to attract the bonus rate, or if you lose your bonus rate because you make a withdrawal, then your money may not grow at the best rate.

Your chosen bank or institution folds

The Australian Government Guarantee Scheme guarantees deposits of up to $250,000 per person, per institution, so as long as your deposits don’t exceed this limit, you’ll be insured by the Australian government up to these limits. If you have more than $250,000 to deposit, divide it up between different institutions so that you’re protected by each bank’s guarantee.

Read more about top savings accounts in January 2020 at InfoChoice.

Compare savings accounts from Australia’s banks and credit unions at InfoChoice.

The products compared in this article are chosen from a range of offers available to us and are not representative of all the products available in the market and influenced by a range of factors including interest rates, product costs and commercial and sponsorship arrangements

InfoChoice compares financial products from 145 banks, credit unions and other financial institutions in Australia. InfoChoice does not compare every product in the market. Some institutions may have a commercial partnership with InfoChoice. Rates are provided by partners and taken from financial institutions websites. We believe all information to be accurate on the date published. InfoChoice strives to update and keep information as accurate as possible.

The information contained on this web site is general in nature and does not take into account your personal situation. Do not interpret the listing order as an endorsement or recommendation from us.  You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from a financial adviser. If you or someone you know is in financial stress, contact the National Debt Helpline on 1800 007 007.

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