The best “strings attached” saver accounts

At a time of historically low interest rates in Australia, it can be hard to know what to do to grow your money effectively. One option is to lock it away in a term deposit for up to five years and while this is a safe, reliable option, your money is literally locked away for the term. If you need to access it, you’ll be penalised either by losing some of all of the interest you’ve earned or by having your interest rate reduced.

Many saver accounts in Australia are offering interest rates of just over one per cent p.a. right now, which is a far cry from the highs of the late 1980s when savers benefitted from a cash rate of 17.00 per cent p.a. or more. 

Some saver accounts are nudging the 2.00 per cent p.a. barrier, with others sitting just below it and that’s as good as it gets at the moment. 

You have to “earn” your interest with some savers

It’s still possible to get a reasonable interest rate with the accounts that offer bonus rates and incentives for savers. You might see these incentives as “strings attached”, but if you’re prepared to abide by the rules, you can get some good returns.

The so–called “strings” attached to these accounts can include minimum monthly deposit requirements, no withdrawals in order to earn the bonus interest rate the following month, or a certain number of transactions performed from an account linked to the saver. 

Some people will find most or all of the requirements easy to fulfil, while others might find making a deposit every month hard to keep up with. You might find a string you don’t mind being attached to among these accounts that InfoChoice has picked out for you.

IMB Bank Reward Saver

The IMB Reward Saver offers savers a bonus rate of 1.30 per cent p.a. for balances over $5,000 and 0.65 per cent p.a. for balances under $5,000. There’s no minimum opening balance, so this account could work well for younger people. 

The requirement for the bonus interest rate is that you must deposit at least $20 each month and make no withdrawals. If you do this, you’ll get the 1.30 per cent rate the following month. If you don’t meet these requirements, you’ll get zero per cent interest – that’s right. Zero.

There are no account fees with this account and you can use the ATM for free, as well as have phone, internet and counter banking. You don’t need a linked transaction account to this saver, either, which makes it very flexible.

HSBC Flexi Saver account 

The Flexi Saver account offers savers a variable bonus interest rate of 1.00 per cent p.a. as long as the balance on the last business day of the month is $300 higher than it was on the first business day of the month. This amount doesn’t include interest; it has to come from deposits and if this requirement isn’t met then the interest rate reverts to the base rate of 0.01 per cent p.a. for the next month.

This account has no minimum opening balance and a maximum balance of $5,000,000. There are no account fees and while you can use phone, internet and counter banking, there’s no ATM facility. There’s no need to link this saver to any particular transaction account, which offers some freedom.

Greater Bank Life Saver account

The Life Saver account is for savers under the age of 25 and offers them a variable interest rate of 1.60 per cent p.a. with no requirements other than that the balance remains above $1. 

Account holders can link the saver account to their transaction account and, for every month that the saver balance grows, the transaction account fees can be waived. This is a good way for younger people to boost their savings.

It’s a fairly basic account otherwise, with no ATM access, debit card or chequebook facility. Holders manage the account over the phone, the internet or over the counter.

Rabobank Online Savings High Interest savings account

This online–only account has an attractive maximum rate of 2.00 per cent p.a. on balances of up to $250,000, but only for the first four months.

While you don’t have to link it to a Rabobank transaction account, make a minimum monthly deposit or avoid withdrawals, you will only get four months of this rate. After four months, the interest rate reverts to a base rate of 0.55 per cent p.a. and you’ll have to decide whether you want to stay with the base rate or move the funds to a new account with an introductory rate.

There are no fees, and as an online–only account, you don’t have phone or counter banking. You can simply move money between the saver and your linked transaction account for free.

Volt Bank savings account

If you’re wondering about saver accounts with no strings or requirements, then Volt’s savings account may well work for you. This app–based account offers an interest rate of 1.45 per cent p.a. no matter what you do, as long as your balance stays under $245,000.

You can make deposits each month or not, make as many withdrawals as you like (or not) and whatever money is in there receives the 1.65 per cent treatment. 

Volt is a neobank and received a restricted ADI licence from APRA in 2018. This means that the bank can take deposits from customers and that their money is covered by the government’s Financial Claims Scheme, but the bank can’t yet offer a full range of services.

Compare High Interest Savings Accounts at InfoChoice.

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