A year might seem like a long time to lock away your savings but rest assured, if you've done your homework, investing in a 12 month term deposit can be a great way to maximise your wealth. With a term deposit, the interest rate is guaranteed as long as you don’t have to access your money before the end of the chosen time period.

A 12 month term deposit is a fixed rate account where you agree to lock away your money for one year. In return, you receive a guaranteed interest rate. This account type with a 12 month period can be ideal for those with specific savings targets where money doesn’t need to be accessed for the next year.*

Why choose a 12 month term deposit?

Whether you're saving for a house deposit, planning an overseas holiday, or building your emergency fund, a 12 month term deposit offers several advantages. You'll see a predictable growth in your cash due to the fixed interest nature of term deposits. This also helps you avoid the temptation to dip into your savings, otherwise you may see some or all of your interest go.*

12 month term deposit interest rates

While interest rates vary between financial institutions, 12 month term deposits generally offer competitive rates. These rates are often higher than shorter-term deposits and can even be higher than some long term deposits. This means your returns are guaranteed, regardless of market fluctuations. Remember, even a small difference in interest rate can significantly impact your returns over a year.*

Finding the best 12 month term deposit rates

Most major banks and credit unions offer 12 month term deposits. Comparing multiple providers can help you find the term deposits with the highest rates. 

Pros and cons of a 12 month term deposit

Locking your savings away for a whole year may seem a little daunting. To make sure you're making the right decision, consider the pros and cons. 

To get a more in depth view, check out our pros and cons of term deposits guide.

Is a 12 month term deposit right for you?

If you have a lump sum of cash that you won’t need to access for over a year, a 12 month term deposit is an effective and safe way to make some extra money. However, it is important that you’re sure you won’t need to access your money for at least 12 months.*

A good way to ensure you won’t need to access your term deposit early is to make a budget. If you need help making a budget, check out our free budget calculator!