Pain intensifies for savers as average ongoing rate plummets to 0.99%

The outlook for Australian savers just keeps going from bad to worse with new figures released today revealing a concerning new threshold has just been crossed.  

According to savings account figures in the Mozo database, the average ongoing savings rate has dropped below 1.00% for the first time since Mozo started tracking rates back in January 2012.

The average ongoing rate, which combines 184 different personal savings accounts with either an ongoing rate or ongoing bonus rate (which have minimum requirements), now sits at just 0.99%. 

“While the recent Reserve Bank rate cuts will have delighted Australian homeowners and eased mortgage stress, the same is certainly not true for savers,” said Mozo Director, Kirsty Lamont. 

“For the first time in over a decade the average ongoing rate in our database has dropped below 1.00%, with many banks now offering paltry savings returns of 0.10% and below.”

Are savings rates at record lows?

To put the current rate into perspective, the average ongoing savings rate in the Mozo database in November 2014 was 2.53% - almost triple that of the current average. 

As the graph below shows, the savings slide has essentially tracked the official cash rate over the past five years. Since November 2014, the cash rate has dropped from 2.50% to today’s level of 0.75%, though the correlation is likely to provide little solace for savers.

It goes back even further though. 

Historical figures from the Reserve Bank stretching back to September 1989 (data isn’t available beyond that) reveal that savings account rates have not hit current low levels at any time in the past 30 years. 

Lower rates, diminishing returns 

Just how much of an impact has the drop actually had on the interest Aussies can accrue from their savings accounts though? 

Let’s run through a scenario using the Mozo savings calculator

Regular saver Tim has already managed to save $10,000, which he adds $100 to each fortnight when he gets paid. If Tim was getting the average return from November 2014 of 2.53% he would end up with a balance of $18,915 after three years, including $1,088 in interest. 

In comparison, Tim would end up with a balance of $18,244 after three years if he was earning today’s average rate of 0.99% - a difference of $671. 

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While ongoing savings rates have been tumbling, there are still a number of options available for savers willing to meet minimum deposit requirements each month. 

For example, here are five of the highest bonus rate savings accounts currently* in the Mozo database.

Maximum RateRequirements
MyState Bank - Bonus Saver Account2.25% (up to $150k)$20+ deposit and 5 card transactions each month
86 400 - Save Account2.25% (up to $100k)Min $1,000+ deposit per month into Save or pay account
Up - Saver Account2.25% (up to $50k)Min 5 card transactions per month with Up debit card
BOQ - Fast Track Saver Account2.15% (up to $250k)Min deposit of $1000 into linked Day2Day Plus account
UBank - USaver with Ultra Transaction Account2.10% (up to $200k)Min deposit of $200 or more into either account

For more details, including a complete overview of each account’s rate and requirements, make sure you check out the linked review. 

Otherwise for even more great introductory and ongoing savings account offers, check out the table below, or head over to the Mozo savings account comparison table to compare more than 200 different savings accounts from 60 banks.  

*Accurate as of November 18, 2019.

Compare savings accounts - last updated 31 May 2024

Search promoted savings accounts below or do a full Mozo database search. Advertiser disclosure
  • Mozo Expert Choice Badge
    High Interest Savings Account

    5.75% p.a. (for $0 to $250,001)

    4.40% p.a.(for $0 to $250,001)

    Yes up to $250,000

    Bonus rate for the first 4 months from account opening

    Reward yourself with a higher rate for your good savings habits with the Rabobank High Interest Savings Account. No Account keeping fees. No minimum balance. Support Aussie farmers with every dollar you save.

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  • Savings Account

    5.35% p.a. (for $0 to $250,000)

    4.75% p.a.(for $0 to $1,000,000)

    Yes up to $250,000

    Bonus variable rate is available for the first four months.

    Competitive introductory variable rate for first 4 months (on deposits up to $250,000). No account keeping fees to pay. Multiple 2023 Mozo Experts Choice Award winner.

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  • High Interest Save Account

    5.10% p.a. (for $0 to $250,000)

    0.10% p.a.(for $0 and over)

    Yes up to $250,000

    Deposit at least $200 to either Spend, Bills or Save account from an external source each month.

    No monthly fees on any of your save accounts. Split your money with up to 10 Save accounts. Set savings targets and track the progress of all your Save accounts. Deposits guaranteed up to $250K per customer.

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  • Reward Saver Account

    5.25% p.a. (for $0 to $1,000,000)

    0% p.a.(for $0 and over)

    Yes up to $250,000

    Intro bonus rate of 5.25% for balances up to $1,000,000 for the first 4 months, reverting to 3.25%. Minimum deposit of $50 and no withdrawals.

    Introductory bonus rate for balances up to $1,000,000 for the first 4 months. Minimum deposit of $50 and no withdrawals. Start your account online in under 10 minutes and earn interest on balances up to $1,000,000 (T&Cs apply). No monthly account fees, helping you save smarter and faster.

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  • Bonus Saver Account

    5.00% p.a. (for $0 to $250,000)

    0.05% p.a.(for $0 and over)

    Yes up to $250,000

    Bonus rate when at least $20 is deposited each month and five Visa Debit transactions are made each month using linked Glide transaction account.

    Start saving and earn interest with just a $20 deposit and make 5 eligible transactions each month. No fees or penalties for withdrawing money.

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^See information about the Mozo Experts Choice Savings Account Awards

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