Compare Term Deposits in Australia

Looking to lock away some cash for the short or long term? Mozo can help you get the best return on your money. We compare term deposit interest rates from 64 banks to help you find the best term deposit for your investment needs.

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Finding the best term deposits in Australia

Understanding how term deposits work is the first step to finding the best bank term deposit for you. Term deposits work much like a savings account, in that you earn interest on the money you put in the account. The catch is, you can’t access the money for a set ‘term’. In return, you often receive a better interest rate than if you were to put the money in a savings account.

There are short term or long term options for locking your money away in a term deposit here in Australia. Most banks offer term deposits which range between 1 month and five years. The longer the term, the higher your interest rate will likely be, and the more you’ll earn on your deposit. Once you’ve chosen your term length and amount, head below to compare bank interest rates for term deposits in Australia.

What can I do to get the best interest rate for my term deposit?

There are many different factors that can affect the interest rate you receive. Everything from your term duration and deposit amount, to the bank you choose will play some part.  

Use our comparison table below to compare interest rates between banks. For a customised listing based on your deposit amount and desired investment term, check out our term deposit search. We’ll compare all the Australian banking providers in our database and show you a listing of the interest rates available.  

Should I put my money in a term deposit or savings account?

Term deposits and savings accounts are both great ways to save some extra cash for the future.

Term deposits are best suited to those who know they won’t need access to their money for a set time period. Interest is generally higher than that of a savings account, but be aware that if you do need to take out your money before the end of the term you could be made to pay break fees.

An high interest savings account is a great option for those that need regular access to their money. These accounts are more flexible than term deposits, allowing you to add and withdraw money at any time. Some savings accounts have interest rates that are similar to term deposits so depending on your savings goal they could be a good option.

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Page last updated December 12, 2018

Term deposit comparisons on Mozo - rates updated daily Mozo has robust processes to ensure our site is updated to reflect the latest information from providers. There may be the odd occasion where updates are delayed, so please confirm information before purchasing.

Want more? Compare all 78 term deposits in the Mozo comparison engine.

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*Different interest rates apply to different amounts or different interest payment frequencies.

Term Deposit Resources

Reviews, news, tips and guides to help find the best term deposit for you.

Intro into term deposits and FAQs

Are you looking for more bang for your buck? If you're not a risk taker and would rather take a conservative approach when it comes to your money, a term deposit might just be your answer.

With your money locked away for a set period of time at a fixed interest rate, a term deposit will allow your savings to grow without lifting a finger. A term deposit works especially well for those who often dip into their savings. It's hands off until the term has ended! Let's take a look at all the things you need to know when choosing a term deposit.

This pages is about personal term deposits, head over to our business banking section if you're after business deposits.

Term deposit key features

Terms/time period:Term refers to the duration of the investment. There are two main types of term deposits that banks offer, Short-term and Long-term. Take the time to consider your financial goals and this will help you decide which term is best for you. For example, are you looking to purchase a car sometime in the next 12 months or are you planning an overseas holiday?

Short-term deposits: Stash your cash for as little as three, six or even twelve months.

  • With shorter terms, the banks are more likely to offer a lower interest rate
  • If you need to access the money in the near future, a short term deposit may suit you better
  • Check out the best short term deposits on offer by using our Term Deposits search engine here.

Long-term deposits: A long-term deposit is any period from one year up to say five years.

  • It's likely to be the best interest rate going around
  • It's ideal for the sensible saver who's looking for continual growth in their savings with no risk
  • Have a look at Mozo's in-depth list of long-term deposits

Some financial institutions will offer rollover term deposits. This gives you the option of rolling over your investment for another term. So, sit back and watch your savings grow even more. Always check that on that particular term deposit at the time of rollover, you are being offered the best interest rate.

ALSO REMEMBER – There are penalties for early withdrawals from any term deposit!

Interest rates: Unlike a home loan where you choose between a fixed or variable interest rate, a term deposit is fixed i.e. the interest rate will not change. Therefore, if interest rates drop, you don't need to worry when you have a term deposit.

Take the time to work out what you want from your fixed term investment. For once in your life you are given permission to shop, shop, shop! Look around and find the best interest rate to suit the amount you are investing and the most suitable duration of your term deposit.

For the best term deposit interest rates in Australia, search the Mozo term deposits database. This includes Australia's major banks, credit unions and financial institutions.

When is the interest paid on a term deposit?

Unfortunately you're dreaming if you think the bank might pay interest weekly! Sadly, the banks were clever enough to change the headline interest rate according to the payment period, so you can't sneak in a better deal by choosing a shorter timeframe.

For short-term deposits, interest is usually paid at the end of the term. When it comes to long-term deposits, interest is likely to be paid annually.

Term deposit interest payment method is typically via direct credit into your nominated account. In some cases the financial institution that holds your term deposit may pay the interest to another bank of your choice.

To get an accurate idea of how much your term deposit will be worth in a certain amount of time, use our Term Deposit Calculator.

How much can I put into a term deposit?

When it comes to term deposits, banks like to work in round figures. You can invest in anything from a minimum of $1000 - $Infinity!!!

The balance limits are detailed in our term deposits comparison table above.

What fees will the banks slap me with?

The good news is there are no set up, ongoing or annual fees with term deposits. Believe it or not the banks have actually set you free from fees! But always be sure to check the fee details with your bank before signing the dotted line.

There are however hefty penalties for withdrawing your savings before the term has matured. Do everything you can to avoid the EARLY WITHDRAWAL PENALTY.

Some accounts allow a partial withdrawal of your term deposit; others require a full withdrawal. In either case, the banks hit you with:

  • Reduced interest on your deposit
  • Penalty Term deposit fees

Will my money be safe in a term deposit?

The Australian Government guarantees term deposits of up to $250,000 with Authorised Deposit-taking Institutions (ADIs) such as your bank, credit union or building society. So if anything unforeseen happens to your ADI, you are covered.

What are the cons of a term deposit?

  • A term deposit can't be topped up until it matures
  • As tempting as it may be, there's no dipping into the deposit until the end of the term
  • Penalty fees apply if you have no choice on withdrawing your hard earned savings early
  • If interest rates rise, you might find that what seemed a generous term deposit rate doesn't look nearly as generous two years down the track.

What are the pros of term deposits?

  • Bad spending habits and temptations are restricted as your savings are untouchable
  • A fixed interest rate provides security on your investment
  • No need to stress if Reserve Bank rates fall
  • Financial goals can be reached without the risks associated with investing in shares and property.

Term Deposits vs Savings Accounts 

It's the old age question… what should I do with my money? Is it best for those lifelong, hard earned savings to be invested in a term deposit or just sit in a savings account?

  • If you're a 'commitment phobe' then a term deposit may not be for you. Therefore, opt for a high interest savings account which is much more flexible and accessible
  • Penalties apply if you withdraw money from a term deposit before the term has ended. There are no fees for taking out money from a savings account
  • You can't make additional payments to your term deposit. Savings accounts can be topped up when you like i.e. daily, weekly, monthly etc.
  • The bank has the potential to change interest rates on savings accounts, including offering less interest. Variable interest rates means your interest can suddenly drop. Interest rates are fixed with a term deposit, so it's a safer place to park those extra savings.

Learn all you need to know about savings accounts here!

What to consider when choosing a term deposit that suits you

With all the financial institutions offering term deposits it can be a little overwhelming as to which one to hand your money over to. Read some term deposit reviews here!

  • Financial Goals: Have a good think about your financial goals and what you're hoping to achieve with that hard earned money. Throw some figures in the Mozo budget calculator!
  • Terms: When might you need to access all those savings? If it's in the near future (three months to a year), go with a short-term deposit. Any longer, opt for a long-term deposit.
  • Have a play with our term deposit calculator to see how longer terms should increase your earnings.
  • Interest Rates: Shop around and find the best interest rate to suit your chosen term. To save time and avoid frustration Mozo has made things a lot easier for you.

Useful Tools

Checklist when opening a term deposit:

So, having decided on your term, interest rate and bank, it's now time to set it all up, and watch as your savings increase without you lifting a finger. Here's what you need when applying for a term deposit:-

  • Name, address, phone number
  • Proof of identification e.g driver's licence plus Medicare card
  • Your tax file number
  • Details of your nominated bank account from where the funds will be transferred
  • Details (if any) of any other people who will be noted on the Term Deposit.

Term Deposit Reviews

Bank of Queensland
Bank of Queensland term deposit review
Overall
8/10
Great

There are small problems like any other bank but I still find it not bad. When transferring money...

There are small problems like any other bank but I still find it not bad. When transferring money between accounts, there is great privacy and you feel safe.

Price
8/10
Features
10/10
Customer service
9/10
Convenience
7/10
Trust
7/10

Steven | New South Wales

reviewed 1 day ago

ME
ME term deposit review
Overall
10/10
Great customer service and competitive rates.

I like this bank because it offers great rates for a small investment. Setting up the term...

I like this bank because it offers great rates for a small investment. Setting up the term deposit was very straight forward and easy to organise, and if you need to make any alterations a simple phone call will suffice. I found the process easy and simple to complete.

Price
10/10
Features
10/10
Customer service
10/10
Convenience
10/10
Trust
10/10

Jill | New South Wales

reviewed 6 days ago

Bankwest
Bankwest term deposit review
Overall
9/10
Good old fashion customer service is impeccable.

Bankwest is a reputable bank from the west Australian people. They have great savings accounts...

Bankwest is a reputable bank from the west Australian people. They have great savings accounts that enables you to totally save money each and every month with a 2.2% interest rate fo their hero saver which is really impressive. However the term deposit was a bit of a let down because it took me 31 days to finally access my money.

Price
7/10
Features
5/10
Customer service
6/10
Convenience
1/10
Trust
10/10

Emmy | Western Australia

reviewed 6 days ago

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