Term deposits now paying 5 – 6 per cent

Two years ago, investors were earning 7 per cent from term deposits. Now the best 12-month term deposits are paying only about 5.5 per cent a year, although a bit more can be earned with longer maturity dates and larger amounts.

Even so, the most you will get on a five-year term deposit is about 6 per cent.

Returns on term deposits are likely to go even lower as investment markets struggle. The market is expecting the RBA to cut rates three times in the first half of this year.

Source: The Age