New report reveals Aussies have head in the sand on savings, despite skyrocketing cost of living

A woman is holding her debit card and her mobile phone, looking confused.

One of the easiest ways you can maximise your money is by signing up to a high interest savings account, yet the latest survey data from Mozo reveals that Aussies have their head in the sand with a whopping 69% saying they have never switched savings accounts.

According to Mozo’s personal finance expert, Rachel Wastell, those who have never changed savings accounts are missing out on higher returns on interest at a time when the cost of living is a crucial issue.

A report from the Australian Competition and Consumer Commission (ACCC) backs this up, revealing that 71% of bonus interest rate account holders didn’t meet the conditions to receive their bonus in the first half of 2023.

So, what does all this mean for you? It’s time to get your head out of the sand and consider switching!

If you’re not able to meet the bonus conditions required to earn more interest, you’re better off switching to a savings account with a higher standard rate that doesn’t have criteria attached.

If you can meet those bonus conditions, compare your current savings rate with what’s available as you could be even better off.

Mozo’s ‘SOS’ Savings Report for 2024 found that those who have switched in the past 12 months have a higher average savings interest rate compared to those who’ve never switched banks – and they have more money in the pot too.

The research also found that those who had changed banks in the past 12 months had an average savings rate of 4.53% p.a., while those who have never changed who they bank with had a savings rate of 3.71% p.a. on average.

While that may not sound like much of a difference, over 5 years on a $5,000 balance, savers with the lower rate of 3.71% p.a. could be missing out on $251 in interest – money which could go towards other everyday expenses such as bills and groceries.

When it comes to money in the bank, those surveyed who had swapped savings accounts in the past 12 months had an average savings amount of $35,115, while those who had never switched had a far lower amount of $21,733 on average.

Have you switched savings accounts in the past 12 months?% of AustraliansAverage amount in savingsAverage savings interest rate
Yes8%$35,1154.53% p.a.
No – but I switched between one and two years ago8%$17,1494.05% p.a.
No – but I switched more than two years ago16%$27,8063.70% p.a.
No I have never switched69%$21,7333.71% p.a.

How much money do Aussies have in the bank?

Wastell says a good amount to have in your emergency savings fund is enough to cover three months of expenses, which is about $15,000 in Australia according to Expatistan

Despite this, Mozo’s research found that 75% of respondents had less than $15,000 set aside in their savings account. Alarmingly, 30% of those surveyed had less than $500 in their savings.

“It’s recommended that you have three months of expenses in savings for emergencies, but 3 in 4 Aussie savers have well below that,” says Wastell.

“Over the past few years, we have seen savings balances dwindle as the rising cost of living bites, but that’s why it’s even more important to be getting the absolute best savings rate that you can for your circumstances.”

Overall, Mozo’s survey data revealed that the median amount stashed away is $2,000.

“If you are one of those Aussies who can afford to stash your cash, checking you have the highest rate for your circumstances is the only way to make sure you’re getting the best return,” said Wastell.

This is your sign to swap savings accounts

With 69% of Aussies admitting that they’ve never changed who they bank with, many of us are well overdue to compare savings accounts and make the jump to a better rate.

But which bank should you switch to, and what are the best savings accounts currently available?

The Mozo Experts Choice Awards winners list is a good place to start your comparisons, and of the 53 providers which won awards, the vast majority were challenger banks including the likes of Macquarie, Bank of Queensland, Bendigo Bank, AMP and Great Southern Bank.

ING took out the top award of Everyday and Savings Bank of the Year, as it offers some of the best rates and fee-free account options to Aussies.

Feel like it’s time to switch? Take a look at some of the award-winning savings accounts below.

Macquarie Savings Account
  • 5.35% p.a. for the first 4 months (4.75% p.a. ongoing)
  • Multiple Mozo Experts Choice Award Winner 2024^

The Macquarie Savings Account was awarded in the kick starter and no strings savings categories in the 2024 Mozo Experts Choice Awards. It offers a cracking intro rate of 5.35% p.a. for the first four months on balances up to $250k and has a competitive ongoing rate of 4.75% p.a. There are zero account keeping fees to worry about. You'll need to open a Macquarie Transaction Account as a first step (which also has no account keeping fees), but once that's done you can open as many linked Savings Accounts as you like using the Macquarie mobile banking app – one for each savings goal! This account is 100% online so can only be accessed by the app or via internet banking.

Rabobank High Interest Savings Account
  • 5.75% p.a. for the first 4 months (4.40% p.a. ongoing)
  • Mozo Experts Choice Winner 2024^

If you are looking to kick-start your savings, this award-winning online savings account from Rabobank has a high introductory rate of 5.75% p.a. for the first four months on balances up to $250k. The ongoing rate is still a competitive 4.40% p.a. and there are no pesky minimum balance or minimum deposit requirements. There are also no account fees so you can enjoy both hassle-free and fee-free saving. This account is only accessible via online banking so you’ll need to download the Rabobank app or login via internet banking.

AMP Saver
  • Earn up to 5.40% p.a. on when you deposit $1,000 in the previous month
  • Mozo Experts Choice Award Winner 2024^

If you really want an incentive to save, the AMP Saver account has a high 5.40% p.a. as long as you deposit at least $1,000 into the account in the previous month (on balances up to $250,000). While this is a high monthly savings target to meet, once you deposit $1,000, if needed you can withdraw funds from the account without penalty and still earn the bonus interest. If you don’t meet the previous month deposit criteria, the base rate on the account is 1.20% p.a. (T&Cs apply). There are no ongoing account management fees or transaction fees. This is an online only savings account so you’ll need to manage the account via My AMP online banking or via the MY AMP app. AMP says it takes around 5 minutes to open an account.

Bendigo Bank Reward Saver Account
  • Earn up to 5.25% p.a. on balances up to $100k
  • Only requires $1 to open
Find out more

If you’re looking for a straightforward savings account where you can earn high interest without jumping through hoops, the award-winning Bendigo Reward Saver is worth considering. You only need $1 to open the account and you will need a linked Bendigo transaction account but as long as you grow your balance each month (excluding interest deposits) you’ll earn up to 5.25% p.a. on balances up to $100k. There’s no account keeping fee and interest is paid monthly. If you don’t increase your balance in a month, the interest rate will revert to 0.30% p.a. so it’s a good idea to set up an auto payment into your account so that you’re guaranteed to get the higher interest. The account is 100% online so you’ll access and manage your account via e-banking or the Bendigo Bank app.

These are just some of the winners from the 2024 awards. To see the full list of winners head over to our Mozo Experts Choice Awards page.

^See information about the Mozo Experts Choice Savings Account Awards

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