AMP to slash 3.00% Bett3r Account rate from June 1
Australians trying to get the best return on their money via a high interest savings account could be forgiven for feeling exasperated at the fluctuations among market leading offers in recent years, with AMP the latest bank to announce a bonus rate offer cut.
From June 1, AMP will reduce the bonus interest rate on the Bett3r Account from 1.50% to 0.75% for all customers, meaning that when combined with the standard interest rate of 1.50%, savers will only be able to earn a maximum 2.25% interest rate - down from 3.00%.
Peter Marshall, Mozo’s Product Data Manager, said that the size of the announced interest rate drop was surprising.
“The shift from AMP is quite substantial - especially given that the Bett3r Account has been one of the market leaders for about a year now.”
“While the size of the cut is surprising, this is just part of a wider trend which has seen providers reduce deposit rates even while the RBA's cash rate has not changed for the last 18 months.”
According to figures from the Mozo database, there have already been 17 cuts from providers to ongoing bonus rates in 2018 alone, with an average cut of 15 basis points.
The only rise since the start of the year came from the RAMS Saver Account, which was lifted from 2.80% to 3.00% in March after a rate drop just three months earlier in December.
According to the Mozo Savings Calculator, the difference between the proposed 2.25% rate from AMP and its existing 3.00% rate could be substantial for savers.
For example, a saver who has an existing balance of $10,000 and makes regular contributions of $500 a month would earn $3,940 in interest with a 3.00% interest rate over five years compared to $2,911 with a 2.25% rate.
Searching for a better rate for your own savings stash? Start comparing offers over at the Mozo savings account comparison hub, or check out some of the recent savings account winners with our full list of 2018 Mozo Experts Choice Deposit Award winners.