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Savings Accounts
The highest paying instant access savings accounts
Article updated monthly - last updated on Thursday 11 March 2010
Competition by the banks, building societies and credit unions for your savings is fierce, and with some providers paying 5.75% p.a. interest or more, you should ensure you are maximising your returns on your hard earned cash. With the recent 0.25% interest rate increase on 02 March 2010 by the RBA, with more increases likely to come, it pays to regularly check the savings accounts that offer the highest rate of interest.
This guide provides information on what to consider before opening a savings account. It also shows the current high interest savings accounts in Australia, updated each month. All accounts reviewed are Government guaranteed up to $1million.
Is a savings account right for you? The highest interest paying accounts with instant |  |
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Make sure you're on top of your savings |
Just because the best savings account in the market might offer you a great interest rate of 5% p.a. or more, it doesn’t mean it’s the best place to put your money. So consider the following before you open a savings account.
Are you in debt?
If you have any personal debts with high interest rates such as credit cards or personal loans you should always pay them off first. Many people have credit card debts and ‘rainy day’ savings accounts. This is just throwing money away. Why? Check out this example:
| Debt versus Savings You’ll earn around $52 in interest if you put $1000 in a 5% p.a. savings account (and you’ll pay tax on this – so take another 15-45% off depending on your tax rate). However, a $1000 debt on a 19% p.a. credit card costs you over $200 in interest a year - so you're losing at least $148 by keeping this debt unpaid! |
If you are not able to pay off your credit card every month then transfer your debt to a 0% or low rate credit card - read our 0% credit card balance transfers article for more details.
Home Loan?
If you have a home loan you should consider putting your savings into a 100% offset account or redraw facility. This is really like having a savings account at the same interest rate as your home loan, but the main benefit is the potential tax savings. Read our Got a Home Loan and Savings Account - you're Mad! article for full details.
Term deposits are like fixed term savings accounts. They allow you to lock your money away for a fixed period of time, generally 30 days to 5 years depending on the Financial Institution, and the interest rate is fixed for that period of time.
Before you sign up for a term deposit consider the following points:
Changing Interest Rates
With yet another 0.25% interest rate rise by the RBA on Tuesday 02 March 2010, and more forecast to come in the next 12 months - you need to keep this in mind if you lock your money away for a long time. Always check that the term deposit rate is substantially higher than what you can earn from an instant access account and factor in the real possibility of interest rates rising by 1% or more.
Negotiate
Many Term Deposit providers are able to give you a better interest rate, particularly if you have a decent sum to invest and you are a good customer. So use the comparison sites below to see what the current best term deposit rates are and ask your bank to match it. If they can't you should move your money elsewhere.
This section is verified and updated monthly (or sooner if we hear of a better rate) - last update Thursday 11 March 2010. The research is completely independent and our sole aim is to find the highest interest paying savings accounts in Australia (click here for more details on our honest & independent research promise).
The following accounts provide the highest interest rates for accounts with instant access in Australia. If you're looking for an account for your everyday banking with the high interest rates AND ease of access, please read our Everyday Transaction Accounts article.
Increasing Interest Rates! The RBA has increased official interest rates four times in the last five months. More interest rate rises are still expected this year. Therefore it is essential that you regularly review your savings account to ensure it is paying the highest interest available. |
Launched in August 2009, the UBank USaver* account from UBank (nab) offers a huge ongoing 5.62% p.a. interest. Not only that but if you set up a regular deposit of $100 or more a month, the USaver account will pay an additional 0.10% p.a (taking the rate to 5.72%). This bonus will only be applied to deposits up to $150,000. Click here for more information.
There are no fees on this account but you must have an email address and mobile phone to operate the account as they send log in details via email and sms.
Please note that from tomorrow, Friday 12 March 2010 their rate will increase from 5.62% to 5.75% p.a
The Hunter United Premium Online Investor Account pays 5.88% p.a. on your savings balance every month no withdrawals are made. Minimum opening amount is $5,000. No monthly deposits are required.
No account fees. Click here for more information.
The ING Savings Maximiser* account pays 5.85% p.a. on your savings balance as an introductory rate for the first four months (new customers only). After four months it will revert to 4.50% p.a. variable standard rate.
No account fees and no minimum balance. Click here for more information.
The Bankwest Regular Saver pays 6.0% p.a. on your savings balance. However there are a number of constraints and conditions:
1) Bonus Interest will apply each month if no withdrawals are made, and deposits total at least $50 but no greater than $500. The Saver account must also be linked to an eligible Bankwest account. If you fail to meet this commitment no credit interest will be paid for that month.
2) The maximum opening deposit is $500 and the maximum amount(s) (including any opening deposit) which may be deposited in any calendar month is $500.
No account fees. Click here for more information.
None of the above accounts right for you? Then click here to compare the current top savings accounts.
Want to comment on the above article? Any stories or experiences (good or bad) about providers that you'd like to share? Have you got any other money saving tips? Please share them on our Forum.
Important disclaimer: The above information is carried out using independent journalistic website and our recommendations are general in nature. MoneySavingMaster.com.au is passionate about helping you find the best deals but we can’t take everybody’s individual circumstances into consideration.
If you visit any of the above sites please ensure that you read and fully understand all the product details and conditions, including any product disclosure statements, before you sign up for any product or service. Consult a licensed financial services provider if you require advice about your specific needs. The rates or information provided may have changed since this article was published.
*How this site makes money - As part of our impartial and honest policy we are open about how Money Saving Master makes money. Any link that has a * next to it indicates that this is a paid link. The large red 'Apply' button in the comparison section of this site is also a paid link. For example, if you click through on a credit card provider link and apply for that credit card, this site will be paid money (if we've helped you save money, please support us by using these links when applying - thanks!)
Our research is NEVER impacted by any revenue we earn from these links. If we feature a provider as a 'best buy' and they do not offer a paid link, we will still tell you about them, but we will not always provide a link through to their site. We think that's fair enough....we hope you do to.
We also generate minimal revenue through advertising, such as the Google ads listed below (for this we receive income each time you click on a link).