Yahoo Finance Best savings rates: Easy way Aussies can save $2,271 per year
Aussies could be missing out on thousands by sticking with a dud savings account.
Aussies are being urged to chase down better savings rates, with several banks now offering 5 per cent or more.
Bank of Queensland (BOQ) announced it would increase the maximum rate of its Future Saver account by 0.20 per cent to 5.50 per cent from June 16.
This puts it on par with ING’s Savings Maximiser, with both accounts set to offer the highest ongoing savings account rates on the market.
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BOQ’s top rate is exclusively for customers aged 14-35 with balances up to $50,000, while ING’s is available to all adults on balances up to $100,000.
In contrast, RateCity found the Big Four banks were offering ongoing savings rates as low as 1.10 per cent. The only savings account at 5 per cent among the major banks is Westpac’s Spend&Save account for 15 to 29-year-olds.
“The difference between a cracking savings rate and a dud rate can run into the hundreds, if not the thousands, of dollars in interest over the course of a year,” RateCity research director Sally Tindall said.
“Don’t just assume your bank has passed on each and every rate hike to your savings account. Check your rate. If It’s not above 5 per cent, then it could be time to consider rehoming your nest egg.”
How much can you save?
RateCity found someone with $10,000 in a market-leading savings account could potentially earn an extra $454 in interest over 12 months, when compared to sticking with one of the lowest Big Four savings rates of 1.10 per cent.
For someone with a balance of $25,000, those savings increase to $1,135 a year, while someone with a balance of $50,000 could earn an extra $2,271 a year.
This assumes the person meets any monthly terms and conditions to qualify for the maximum rate. It does not factor in extra deposits or withdrawals.
Top savings rates
Account | Rate | Max balance for highest rate |
ING Savings Maximiser | 5.50% | $100K |
BOQ Future Saver (ages 14-35) | 5.50% | $50K |
Virgin Money Boost Saver | 5.35% | $250K |
Move Bank Growth Saver | 5.25%* | $25K |
Great Southern Bank Goal Saver – (ages 18-24) | 5.10%* | $50K |
BOQ Smart Saver | 5.10% | $250K |
Source: RateCity.com.au. Note ING rate effective 14 June, BOQ and Virgin rates effective 16 June. * yet to announce its response to the June RBA hike.
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