Looking for information on the top savings interest rates in Australia? Mozo tracks the best savings rates from banks and credit unions in Australia - including online only banks like ING DIRECT, UBank and RaboDirect to help you compare and save. If you need to find out who has the best savings rate for your money, Mozo has got you covered.
There are two key types of savings rates and the best rate for you will depend on your saving goal. Some banks offer high bonus or intro rates which last for a few months but then drop to low ongoing interest rates. Look for a savings account with low or no fees and a high standard savings interest rate.
A savings account is a low risk account where you can stash the savings that you don’t plan to use for daily expenses. Generally speaking, they offer average interest rates - lower than, say, a term deposit, but higher than an everyday expense account. Savings accounts usually require a low minimum balance and are a good way to keep your money safe but still accessible.
Most savings accounts calculate and compound interest daily. This means that the amount of interest you earn is constantly growing, and you can boost it by making regular deposits into your savings account. So, for example, if you have $1,000 in a savings account at an interest rate of 2.0% p.a., you’ll earn $20 in interest each year. If you were to add monthly deposits of $175, you could double your interest. Check out our savings calculator to work out what your interest rate is earning you!
Different types of savings accounts will have different interest rates attached to them. Here are some of the popular types of savings accounts and what interest rate you might expect from them.
For technology-savvy savers, online savings accounts are a great way to maximise your interest. Online banking cuts out overhead costs for the banks, which usually means higher interest rates and lower (if any) fees for you.
Offered as incentive to open an account, introductory interest rates usually apply for a period of 3-6 months from the time when you open the account. Intro rates are usually very high, but remember to check the standard rate as well before you open an account, because after the initial introductory period, your interest will go back to the standard rate. An account with a high introductory rate is perfect if you’re saving for a short term goal, like a new car or a shopping spree.
These rates are offered as long as you meet certain conditions, usually something like a monthly minimum deposit or maximum withdrawal limit. An ME online savings account, for example, only requires you to make a weekly purchase using tap ‘n’ go with your linked everyday transaction account.
Bonus interest rates are higher than the account’s standard rate, sometimes by quite a bit, so it's worth checking out what you might have to do to be eligible. Knowing that your high interest rate may be conditional upon not withdrawing from your account is also a great motivator to stick to your budget!
If you want an account that you can leave your savings in for a longer period of time and you’re not interested in switching around to chase introductory or bonus rates, look for a savings account with a high standard interest rate. Take a look at Mozo’s long term savings account comparison to find out which bank is offering the best interest rate at the moment.
It’s never too early to introduce your kids to the importance of saving! You can start by opening a kids savings account. While these accounts generally don’t have any fees, and their introductory or bonus rates are competitive, these rates also often depend on conditions like a monthly minimum deposit. If you’re not sure that your child can meet the requirements, it's better to search for an account with a higher standard interest rate.
There are a few key features to keep in mind when you’re shopping around for a competitive savings account. While securing the highest possible interest rate might seem like the most important thing, it can sometimes be a bit trickier than that. Keep an eye on these things when choosing a savings account:
When you compare savings accounts on the Mozo website, you’ll see special and standard interest rates. The high special rates are always very tempting, but it’s important to remember that these rates often don’t last more than a few months, or may be reliant on conditions that you can’t meet. That’s why it's important to look at the standard interest rate and make sure it is also competitive.
A savings account with a high introductory interest rate is a great way to boost your savings. This is great because it isn’t reliant on withdrawal or deposit requirements - all you need to do is open the account.
Some savings accounts, especially online ones, will require you to have a linked transactions account so you can transfer money to and from the savings account. Make sure that you’re not paying extra fees or charges with this account, or all your hard earned interest may not mean much.
These days, most online banking is fee free, but make sure you’re not paying annual account fees or transaction fees. When you’re trying to maximise your savings, a high interest rate may not mean much if you’re paying extra fees on the account.
Sometimes your interest rate will depend on you maintaining a minimum monthly balance or making a minimum monthly deposit. If you can’t do so, some banks will lower your interest rate for the month, or maybe not pay interest at all.
Before you choose a savings account, it's a good idea to look closely at your budget and choose an account with conditions you can meet each month.
Your savings account is designed as a place to park your money and leave it there. That means there could be conditions or penalties for making withdrawals from it. Some accounts might not pay interest for the month in which you made a withdrawal, although some will allow one withdrawal without penalty. So if you can, leave your savings account alone, and check out a competitive transaction account instead.
If you’re looking to maximise your savings, earning interest is one of the easiest and low-risk ways to do it. Use some of these handy tips to help you make the most of your savings account interest rate.
Online banking is easy and efficient, and you can do it wherever and whenever you need to. Even better, online accounts usually come with no fees and high interest rates. If you don’t need to have branch access and are happy to manage your savings from the comfort of your own lounge chair, an account with an online provider is competitive and convenient.
You can take advantage of high introductory interest rates by switching accounts regularly. Most introductory periods last between 3 and 6 months, so when one runs out, you can close the account and open a different one. This can be a time consuming process and can be more of a hassle than it’s worth for some people, but one of the benefits of online banking is that it’s easier than ever to switch bank accounts.
You need to take a lot of things into account when choosing the right savings account for you - bonus and introductory interest rates, ongoing interest rates, fees and conditions. You need to know what kind of deposits your budget allows for and how you want to use your account. It can all seem a little overwhelming, so here at Mozo, we’ve taken some of the hard work out of it for you, with these handy resources:
Savings account comparison page - check out all the latest interest rates available on savings account from a range of providers and choose the one that suits you best.
Savings account guides - we’ve got guides covering all the important details you’ll need to know about setting up a savings account that will earn you the most interest.
Reviews of savings accounts - there’s nothing better than first hand experience! Read reviews from customers on their savings accounts experiences.
You can also find out more about interest rates, how they work and what they mean for you by visiting our interest rate guides pages.