Long term deposits offering 7.3 per cent

Five year term deposits are now offering interest rates above 7 per cent. RaboDirect is offering 7.3 per cent for five year term deposits. Interest rates offered by term deposits vary widely and institutions change the rates on offer often. Ensuring that your money is getting the best rate may mean changing from one bank to another at the maturity date.

One way of juggling interest rates offered by different period term deposits is to consider a portfolio approach. If you think that a five year rate offering 7.5 per cent could be close to the best you may get for the next few years, you might commit half or two-thirds of the money you are prepared to allocate to term deposits to this longer term. Just in case rates go up, you leave some of your money in a shorter period.

Source: Sydney Morning Herald