Savers must look beyond the headline rate

One in three deposit accounts pay no interest at all on balances of less than $1000.

More than half of accounts pay less than 2 per cent interest, even on deposits of $5000. Less than a quarter of accounts pay more than 4 per cent interest on a balance of $1000 and even for $5000 deposits, fewer than one-third of the accounts pay more than 4 per cent.

So, if your account has a headline rate of 4.25 per cent, you could find you earn little or no interest on the first $1000 invested and lower rates up to $5000, $10,000 or even $500,000.

Source: Sydney Morning Herald

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