Australia’s Best Term Deposits June 2022

woman-with-arms-outstreched-wide

Whether you're saving a deposit for a home or building up an emergency fund, a term deposit with a fixed interest rate could be one of the more reliable ways of ensuring that your savings balance continues to grow over time.

The good news for savers is that after a period of decline term deposit rates are starting to edge higher. According to the latest figures from the Mozo database a number of banks have recently lifted their interest rates, with some banks now offering rates closer to the 4.00% mark for longer terms.

But with different interest rates, term lengths and account features on offer, how can you go about finding the best term deposit match? At the end of the day the ‘best’ term deposit for you is going to be different to the next person, because everyone has varying needs and requirements. One place to start though is by comparing award-winning term deposits.

Every year Mozo’s team of in-house financial experts compare a range of banking products as part of the Mozo Experts Choice Bank Account and Savings Awards^ - including term deposits. In fact, in 2022 our judges analysed 74 different term deposit accounts in order to name winners in the best term deposit category, some of which we’ve wrapped up below. The Mozo editorial team also rounded up information about some great 36 month term deposits which caught our attention.

Expert Picks: Award-winning best Term Deposits

people-looking-at-best-term-deposits

Rabo - Term Deposit
  • 3.50% p.a. for 5-year terms
  • 0.10% loyalty bonus (conditions apply)
  • Deposits up to $2,000,000

This award-winning Term Deposit^ offers interest rates as high as 3.50% p.a. on 5-year terms (when interest is paid at maturity), which competes with some of the highest rates 5-year terms in our database. Rabo offers terms starting from one month up to 5 years with a minimum deposit of $1,000 and a max of $2,000,000. Sadly, your interest rate can’t be paid to another bank, but if you opt for an automatic rollover, you automatically get a 0.10% p.a. loyalty interest rate bonus.

MyState Bank - Term Deposit
  • 3.00% p.a. interest rate for a 2-year term
  • Can have interest paid to another bank account
  • Deposit up to $5,000,000

Keen to lock your savings away for a fixed period of time in order to earn a guaranteed interest rate? Well, MyState Bank’s award-winning Term Deposit^ has options from as short as one month to as long as two years depending on your needs, and it currently offers interest rates as high as 3.00% p.a. for a 2-year term when interest is paid on maturity. MyState Bank customers can also choose to have the interest they earn on their term deposit balance paid into an account from another bank. There is a minimum deposit requirement of $5,000 to open an account, but savers can choose to deposit up to $5,000,000.

Judo Bank - Term Deposit
  • 3.85% p.a. interest rate for a 5-year term
  • 0.10% loyalty bonus
  • Interest can be paid to another bank
Find out more

If you’re looking for a competitive interest rate and some flexible features, Judo Bank’s award-winning Term Deposit^ is an option worth taking a closer look at. The Term Deposit comes with term options between three months and five years, with interest rates as high as 3.85% p.a. on a 5-year term (when interest is paid at maturity) - the highest currently in our database. Aside from the rates, Judo Bank lets savers have their interest paid to another bank and they’ll give customers a 0.10% interest rate bonus if they roll over their principal for a new term once it reaches maturity. Just remember, there is a minimum deposit requirement of $1,000 to get started and a maximum of $1,000,000.

AMP Bank - Term Deposit
  • 4.10% p.a. interest rate for a 5-year term
  • Interest can be paid to an external account
  • Deposits up to $5,000,000 accepted
Find out more

AMP Bank’s award-winning Term Deposit^ could cater to savers looking for a term deposit offering both competitive rates and plenty of choice. The account offers terms between one month and five years, with the highest interest rate currently available 4.10% p.a. on a 5-year term when interest is paid at maturity for balances up to $24,999. If your balance more than $25,000 you get a 4.15% p.a. rate when interest is paid at maturity. AMP also allows Term Deposit customers to have their interest paid into an account from another bank. One thing worth noting though is that while savers can open an account with a balance between $5,000 and $5,000,000, the highest interest rates available are for deposits of $25,000 or more.

Editor’s pick of the month: Great 36 month term deposits on Mozo in June

editor's picks term deposits

With term deposit interest rates rising, you might want to consider locking in for mid-length term. The average 36 term deposit rate in the Mozo database is currently 2.04% p.a. Here’s a selection of 36 month term deposits handpicked by our editors that offer rates above 3.00%. To compare them against other options, check out our term deposit comparison page to explore our complete database.

Qudos Bank - Term Deposit
  • 3.00% p.a. for 3-year terms
  • Deposit up to $1,000,000

Qudos Bank is a 2022 Mozo Experts Choice Award winner for Australia’s Best Large Mutual Bank and offers a high 3.00% p.a. interest rate for 3-year deposit terms when interest is paid on maturity. Terms start at 3 months and go up to 3 years for deposits from $2,000 to $1,000,00. Unfortunately, the interest earned on your term deposit cannot be paid to an external bank account. But Qudos does offer automatic rollovers if you wish to extend your term deposit.

Judo Bank - Term Deposit
  • 4.00% p.a. interest for 36 month term
  • Minimum deposit of $1,000
Find out more

Judo Bank recently took out a 2022 Mozo Experts Choice Award^ in the best Term Deposit category thanks to its highly competitive interest rates. The bank’s terms are from 3 months to 5 years and you only need $1,000 to get started and you can put up to $1,000,000. Its 36 month term currently sits at a high of up to 4.00% p.a. interest rate if you get interest paid at maturity or annually. Judo Bank’s rates are actually some of the highest being tracked in the Mozo database. That’s not all: savers can also earn an additional 0.10% loyalty bonus by reinvesting their balance into another Judo term deposit, once the first has reached full maturity. If you decide you need to withdraw your money, you can retrieve it as long as you give a written 31 days notice. Be aware that withdrawing funds early comes with a cost in the form of an interest reduction.

ME Bank - Term Deposit
  • 3.25% p.a. interest for 36 month term
  • Minimum deposit of $5,000
Find out more

ME Bank’s term deposit offers terms from 1 month to 5 years to help you grow your savings. Its 36 month term rate has a decent interest rate of 3.25% p.a. Keep in mind that if you choose to be paid interest monthly, your rate will be lower. To get started you need at least a $5,000 deposit and have a max of $5,000,000. ME Bank also gives you the option to make a withdrawal before the maturity date when you give a written 31 days notice, but be mindful that there could be an early withdrawal percentage reduction to your interest. The amount of reduction is based on when you withdraw over the period of your term.

The most common FAQs about term deposits

What’s the difference between a term deposit and a savings account?

If you’re weighing up whether a term deposit or savings account would be the best fit for your savings there are a few major differences to consider. Term deposits come with fixed interest rates so you’ll know exactly how much you’ll earn over time, but the trade off is that to earn that interest you won't be able to access that money (without penalty). On the other hand, savings accounts come with variable interest rates which can be changed by your bank (up or down) at any time, but you’ll also have easier access to your money.

Do the best term deposits have account fees?

The good news about term deposits is that the vast majority don’t come with monthly account fees, including our best Term Deposit award winners listed above. Don’t forget that a penalty of some kind will most likely apply if you choose to withdraw your money from a term deposit ahead of schedule though.

Are term deposits safe?

Term deposits issued by authorised deposit-taking institutions (ADIs) in Australia are covered under the government’s Financial Claims Scheme. The scheme provides a guarantee for deposits of up to $250,000 per person, per institution in the unlikely event that an ADI fails.

Can I withdraw money from a term deposit early?

Yes, it is possible to access term deposit funds early before the maturity date, though there are downsides to doing so. In most cases you will need to give your bank at least 31 days notice beforehand, and you’ll likely be charged an early withdrawal fee or some sort of penalty for doing so.

What are the best term deposits in Australia?

Ultimately we can’t point you towards one  single ‘best’ term deposit, because the best term deposit for you will be based on your own priorities and financial needs. You may find it helpful to browse through the full 2022 Mozo Experts Choice Term Deposit Award winners list though, or if you’re interested in seeing how those award winners stack up against other offers on the market you can head on over to Mozo’s dedicated term deposit comparison hub. 

Just remember, it’s always a good idea to read through the information and any terms and conditions provided on a bank or provider’s website first before making a decision.

* Different interest rates apply to different amounts or different interest payment frequencies.

Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.

While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.