Tough times for Aussie savers as Big Four banks slash rates
Australian savers are feeling the heat as two of the Big Four banks ring in the new financial year by lowering their base rates on standard savings accounts.
Commonwealth Bank and Westpac slashed interest rates by 30 basis points on their NetBank Saver account and eSaver account respectively, to just 0.50% p.a.
“For most of the Big Four bank customers who continue to leave their savings in these accounts after the bonus rate period expires, the return is paltry at just half a per cent,” said Mozo Director Kirsty Lamont.
“With a base rate of 0.80% on its iSaver, NAB customers fare slightly better compared to the rest.”
Mozo research found that three of the big four banks have halved their base interest rates on introductory savings accounts in the last year.
“These aren’t just any old accounts but the default savings account products that Big four bank customers are signed up to,” said Lamont.
“The cuts are going to be felt by millions of customers and come as a huge blow to those who have resolved to save more over the new financial year.”
Moving away from the big banks
With so many savings accounts readily available online, there’s really no excuse for keeping your money in an account earning next to no interest.
To find out what you could earn on a $10,000 deposit over 2 years, we used our savings calculator and compared the Commonwealth Bank Netbank Saver account (2.51% introductory rate for 3 months, 0.50% standard rate) with Mozo Experts Choice Award 2018 winner the AMP Saver account (2.55% introductory rate for 4 months, 2.10% standard rate).
With CommBank you would earn $62.75 in the first three months and $87.50 for the rest of the period, but with AMP’s Saver account you would make $85 in the first four months, and $350 in the remaining time. That’s a difference of $284.75.
5 savings accounts offering killer rates
3.05% for 4 months, 1.80% standard - RaboDirect High Interest Savings Account
3.05% for 4 months, 1.70% standard - Citi Online Saver
3.00% for 4 months, 1.60% ongoing bonus rate (no withdrawals) - HSBC Serious Saver
3.00% ongoing bonus rate (no withdrawals, $200 monthly deposit) - RAMS Saver Account
3.00% for 3 months, 1.30% standard - Coastline Credit Union eXtreme Saver
*All figures and rates correct at the time of writing
With so many options at your fingertips, it’s hard to know which savings account is right for you. Use our savings account comparison tool to compare rates from our database of 69 banks, or check out our full list of 2018 Mozo Experts Choice Savings Award winners.