Savings accounts 'are the simplest route to a home deposit'

Tuesday 20 July 2010

Article by Mozo

A standard savings account is the simplest way for first home buyers to start working towards a home deposit, it has been claimed.

An article on YourMortgage.com.au suggests that now that the federal government’s generous First Home Buyer Grant has come to an end, Aussies should look to compare savings accounts where possible in order to improve their prospects in the property market.

It noted that regardless of the option people choose, savers must be disciplined when setting up an account.

"Some banks offer accounts that will penalise you for transferring money out of your savings account," observed the website. "But if you’re not the type to let a $5 transfer fee deter you from splurging with your savings, you’re just going to need to develop some self control."

Elsewhere, the article urged people to commit to a savings plan by having an amount directly debited from their pay on a regular basis.

It suggested that once a "decent amount" has been deposited and account owners can see their interest growing, they will be more likely to leave their nest egg alone until they reach their savings goal.

The comments come after Treasury Secretary Ken Henry last week warned that Australians may struggle to provide for themselves later in life if the country’s elderly population continues to expand at its current rate.

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