December snapshot: Term deposit rates slashed in wake of RBA cut
![A woman walks down the street holding folders in one hand and her phone in the other.](https://cdn.mozo.com.au/images/atwood/11619/woman_phone_content.jpg)
In November another Reserve Bank cash rate cut occured, and since then Mozo has counted an astounding 785 reductions to term deposits. The average cut was 13.7 basis points and the average rate for a one-year term fell 11 basis points to 0.65% p.a.*
Now while it’s clear that interest rates for term deposits aren’t what they were a few years ago, there are still solid reasons to put your money in one. These won’t be the same reasons as they were when interest rates were high, but with a changing financial landscape, now might be the time to rethink motivations.
Time to go 50:50?
As interest rates plummet toward zero, it’s time to stop and think about where to stash that extra cash. Yes, you might be able to get a more competitive savings rate right now, but consider that Mozo counted 44 cuts to ongoing savings rates in November and 16 cuts to introductory savings rates. Introductory rates were cut on average a significant 23 basis points.*
With a term deposit you can lock your money away and fix your interest rate. Of course, the downside of that is that you won’t be able to access that money for the duration of the term. Our Mozo experts suggest considering a fifty-fifty approach. That is taking advantage of more competitive savings rates while they last, but also stashing half your rainy day fund in a term deposit.
Term deposit rates above 1
While term deposit rates have fallen dramatically in the past year, there is still time to lock one in above 1%. Currently Judo Bank dominates the longer terms in the Mozo database, its interest rates are:
- Judo Bank 2-year term - 1.30% p.a.
- Judo Bank 3-year term - 1.30% p.a.
- Judo Bank 4-year term - 1.20% p.a.
- Judo Bank 5-year term - 1.30% p.a.
Or if you’re looking for a slightly shorter commitment, BankVic offers a one-year term deposit with an interest rate of 1.05% p.a.
Want to start searching for a term to put your money in? Check out Mozo’s compare term deposits page for more options, or take a look at the deals below for a quick scan of what’s on offer.
Compare term deposit interest rates
-
Mozo experts choice awards won:
- Term Deposit - 2024
Term Deposit
5.25% p.a.
6 months$1,000
Yes up to $250,000
Great rates and incentives incl. 0.10% added loyalty bonus at renewal. Option to have interest paid to another bank. Winner of the Mozo Experts Choice Awards 2024^ for Term Deposits.
CompareCompareTerm Deposit
Great rates and incentives incl. 0.10% added loyalty bonus at renewal. Option to have interest paid to another bank. Winner of the Mozo Experts Choice Awards 2024^ for Term Deposits.
- interest rate
- 5.25% p.a.
- Minimum deposit
- $1,000.00
- Govt Deposit Guarantee
- Yes up to $250,000
- Minimum deposit
- $1,000.00
- Maximum deposit
- $2,000,000.00
- Can interest be paid to another bank?
- yes
- Automatic rollover
- yes
Read our Mozo Review to learn more about the Judo Bank Term Deposit
-
SMSF Term Deposit
5.25% p.a.
6 months$1,000
Yes up to $250,000
Apply digitally in minutes and manage your SMSF Term Deposit. Flexible cash flow management with three interest payment frequencies that suit you: monthly, yearly, or at maturity. Choose from terms of 3 months up to 5 years. No application or monthly account fees but eligibility criteria and terms and conditions apply. Only accessible to SMSFs with two or up to four individual trustees or one corporate trustee.
CompareCompareSMSF Term Deposit
Apply digitally in minutes and manage your SMSF Term Deposit. Flexible cash flow management with three interest payment frequencies that suit you: monthly, yearly, or at maturity. Choose from terms of 3 months up to 5 years. No application or monthly account fees but eligibility criteria and terms and conditions apply. Only accessible to SMSFs with two or up to four individual trustees or one corporate trustee.
- interest rate
- 5.25% p.a.
- Minimum deposit
- $1,000.00
- Govt Deposit Guarantee
- Yes up to $250,000
- Minimum deposit
- $1,000.00
- Maximum deposit
- $2,000,000.00
- Can interest be paid to another bank?
- yes
- Automatic rollover
- yes
-
Term Deposit - Online only
5.15% p.a.
6 months$1,000
Yes up to $250,000
Looking for returns that return? Invest as little as $1,000 or as much as $1,000,000. Apply online today in as little as 5 minutes. Protected by the Australian Government’s Financial Claims Scheme up to $250,000.
CompareCompareTerm Deposit - Online only
Looking for returns that return? Invest as little as $1,000 or as much as $1,000,000. Apply online today in as little as 5 minutes. Protected by the Australian Government’s Financial Claims Scheme up to $250,000.
- interest rate
- -
- Minimum deposit
- $1,000.00
- Govt Deposit Guarantee
- Yes up to $250,000
- Minimum deposit
- $1,000.00
- Maximum deposit
- $1,000,000.00
- Can interest be paid to another bank?
- no
- Automatic rollover
- yes
Read our Mozo Review to learn more about the Bank of Sydney Term Deposit - Online only
-
Term Deposit
3.70% p.a.
6 months$5,000
Yes up to $250,000
CompareCompareTerm Deposit
- interest rate
- 4.60% p.a.
- Minimum deposit
- $5,000.00
- Govt Deposit Guarantee
- Yes up to $250,000
- Minimum deposit
- $5,000.00
- Maximum deposit
- $1,999,999.00
- Can interest be paid to another bank?
- yes
- Automatic rollover
- yes
Read our Mozo Review to learn more about the Commonwealth Bank Term Deposit
-
Term Deposit
4.25% p.a.
1 year$5,000
Yes up to $250,000
No set up, monthly service or management fees & choose to invest from $5,000 or more
CompareCompareTerm Deposit
No set up, monthly service or management fees & choose to invest from $5,000 or more
- interest rate
- 4.25% p.a.
- Minimum deposit
- $5,000.00
- Govt Deposit Guarantee
- Yes up to $250,000
- Minimum deposit
- $5,000.00
- Maximum deposit
- $2,000,000.00
- Can interest be paid to another bank?
- yes
- Automatic rollover
- yes
Read our Mozo Review to learn more about the Westpac Term Deposit
Your selected term deposits
Your selected term deposits
Your selected term deposits
Your selected term deposits
Your selected term deposits
*Averages and rates correct as of 30 November 2020.
* Different interest rates apply to different amounts or different interest payment frequencies.
^See information about the Mozo Experts Choice Term Deposit Awards
Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.
While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.