Fact checked
A savings account gives you a safe place to store your money, no matter your age. Simply pop your funds away, make regular deposits if you can and watch your balance grow.
The market is flooded with different types of savings accounts and offers, so it’s important to know which deals are the best for your needs. By comparing with Savvy, you can find the right account to help you reach your savings goals.
A savings account is a secure place where you can deposit your money. This type of account is offered by all financial institutions and allows you to earn interest on the money you deposit. This interest is calculated using a percentage rate, which can either be fixed or variable depending on the account you want to open. To be eligible for a savings account, you must be at least 12 years old and a permanent Australian resident or citizen.
It’s important to understand that savings and transaction accounts are two different beasts. One helps you save and the other allows you to spend. Transaction accounts are meant for day-to-day purchases and won’t accrue interest on your balance. In equal measure, savings accounts won’t come with ATM cards, making it harder to access your money. Comparing deals with Savvy will ensure you open an account with a level of accessibility that suits your needs.
Choosing a savings account can feel a bit like selecting a flavour at an ice cream shop. There’s often an assortment of choices, but unlike choosing between flavours, picking the right savings account comes down to which one can best help you yield high interest and reach your savings goals. Your options usually include:
Online savings account
This type of savings account is among the most common offered by financial institutions. Online savings accounts boast competitive interest rates and flexible transaction limits. The only way you can usually access your money is by electronic transfer. Depending on who you bank with, these accounts may offer you a higher interest rate for meeting monthly requirements.
Bonus interest account
These accounts reward you with a high interest rate if you meet monthly requirements. This can be a way of incentivising your savings by giving you a bonus rate if you meet certain conditions, such as minimum deposit or balance requirements. To earn bonus interest, you’ll often have to forego withdrawing any funds or capping your withdrawals at a low number.
Locked accounts
Locked accounts, such as term deposits, make it harder for you to access your money. Term deposits are seen as low risk and low maintenance options which usually offer good interest rates. You can lock more than $1,000 in an account with a fixed interest rate and a fixed term. Once that term is up, you can access your funds or roll it over. You can leave your interest to compound or have it paid into a separate linked account. You can use Savvy’s compound interest calculator to see how much you could earn from a term deposit.
Business savings accounts
These accounts operate similarly to high interest savings accounts but are exclusively for business owners and sole traders. You can park your funds in a business savings account and access them for business-related purchases. These accounts can come with bonus interest requirements, depending on who you open them with, but they tend to come with higher minimum balance requirements than standard savings accounts at $10,000 or more.
Joint savings accounts
Ideal for couples, a joint account allows two people to deposit and withdraw from one pool of savings. These accounts come with ‘one to sign’ or ‘both to sign’ options, depending on protection preferences. With two people depositing into one account, you’ll likely hit your savings goals faster and reduce the impact of any fees. Some institutions will also allow you to have more than two account holders if you’re opening a joint account as housemates or business partners.
Kids’ savings accounts
Managing money is one of life’s most important lessons. A kids’ savings account is a good way of teaching youngsters the fundamentals of saving and how to earn interest on the money they’ve put away. By meeting the low minimum deposit requirements and not withdrawing, your child can yield high interest on their money.
Retirement savings accounts
This type of savings account is very similar to a super fund with one big difference: it’s not subject to market volatility. Retirement savings accounts allow you to make deposits while you’re working which can then be accessed on the day you retire. A few institutions still offer retirement savings accounts despite their low rate of return. Alternatively, once you hit retirement age, you can open a pensioner account. This flexible account earns you interest while also giving you the ability to tap into your funds, making it something of a hybrid of transaction and savings accounts
Finding the right savings account comes down to weighing up several variables. Some of the main factors worth considering in the comparison process include:
Interest rates
The higher your interest rate, the more your money will grow. Securing a good interest rate will allow you to get the best bang for your buck, so you should look for the top rate banks are offering. This is the maximum interest rate you’ll earn if you can meet all the account conditions. You should be able to manage these comfortably, otherwise it could be worth opting for a lower base rate with more affordable requirements. Using Savvy’s goal calculator, you can see how long it’ll take to reach your savings goal at different interest rates.
Fees and charges
Banks recoup the cost of letting you store your money in an account by charging a range of fees. Some institutions waive fees if you meet certain monthly benchmarks, but others have a range of charges for account keeping (up to $5), paper statements (about $2.50) and excessive withdrawals (up to $3). Comparing accounts with Savvy will help you avoid your fees outweighing the interest you’ll earn.
Access to money
How you can access your money is different depending on the account you choose to open. If you can live comfortably without your funds, an account with tighter restrictions such as a term deposit could be for you and maximise your interest earnings. Otherwise, an online savings account which lets you transfer to a linked account could suit you if you’re likely to tap into your money from time to time.
Linked accounts
Financial institutions may require you to have a linked account so you can transfer from your savings account. This everyday account has an ATM card so you can make purchases. You should check if your bank requires you to open a linked account with them or if you’re allowed to go through another institution if you prefer to keep a separate transaction account.
Are you looking to grow your savings? Compare a wide range of savings accounts with Savvy so you find the best deal in Australia and the highest interest rate to help grow your savings.
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Disclaimer: Savvy is not advising or recommending any particular product to you. We provide general information on products for the purposes of comparison, but your personal situation or goals are not considered here. Although we try to make our comparisons as thorough as possible, we do not have information on all products on the market on our site.
You should always consult a given offer's PDS or further documentation in the process of deciding on which loan to choose, as well as seeking independent, professional advice. If you decide to apply with one of the lenders listed above via our website, you will not be dealing with Savvy; any applications or enquiries will be conducted directly with the lender offering that product.
Use our savings calculator to help you calculate how much you could save over a set timeframe based on different deposit sizes and frequencies.
Your savings can put in work for you. Crunch the numbers to see how much interest you could earn on top of your interest by compounding daily, monthly and annually.
It's crucial to have a clear idea of your monthly household budget to see where your money is going and where it could potentially be better spent.
If you're applying for a loan or need to know what your salary is for your tax return, you can use our annualisation calculator to work out what you'll earn this financial year.
Setting savings goals is important. With this tool, you can work out how much you'll need to deposit to reach your financial aims over a set timeframe.
Just as important as knowing how much to deposit is working out how long it'll take to reach your goals. This savings goal calculator can help you do just that.
Quantum Savvy Pty Ltd (ABN 78 660 493 194) trades as Savvy and operates as an Authorised Credit Representative 541339 of Australian Credit Licence 414426 (AFAS Group Pty Ltd, ABN 12 134 138 686). We are one of Australia’s leading financial comparison sites and have been helping Australians make savvy decisions when it comes to their money for over a decade.
We’re partnered with lenders, insurers and other financial institutions who compensate us for business initiated through our website. We earn a commission each time a customer chooses or buys a product advertised on our site, which you can find out more about here, as well as in our credit guide for asset finance. It’s also crucial to read the terms and conditions, Product Disclosure Statement (PDS) or credit guide of our partners before signing up for your chosen product. However, the compensation we receive doesn’t impact the content written and published on our website, as our writing team exercises full editorial independence.
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© Copyright 2024 Quantum Savvy Pty Ltd T/as Savvy. All Rights Reserved.
© Copyright 2024 Quantum Savvy Pty Ltd T/as Savvy. All Rights Reserved.
Quantum Savvy Pty Ltd (ABN 78 660 493 194) trades as Savvy and operates as an Authorised Credit Representative 541339 of Australian Credit Licence 414426 (AFAS Group Pty Ltd, ABN 12 134 138 686). We are one of Australia’s leading financial comparison sites and have been helping Australians make savvy decisions when it comes to their money for over a decade.
We’re partnered with lenders, insurers and other financial institutions who compensate us for business initiated through our website. We earn a commission each time a customer chooses or buys a product advertised on our site, which you can find out more about here, as well as in our credit guide for asset finance. It’s also crucial to read the terms and conditions, Product Disclosure Statement (PDS) or credit guide of our partners before signing up for your chosen product. However, the compensation we receive doesn’t impact the content written and published on our website, as our writing team exercises full editorial independence.
For more information about us and how we conduct our business, you can read our privacy policy and terms of use.
