A savings account is a type of bank account designed for the purpose of saving money. These accounts allow you to deposit money into them and earn interest on the balance. Unlike a transaction account, which is primarily used for everyday spending, savings accounts are meant to help you accumulate money over time.
Savings accounts come in different types and with different features, but generally, they offer a safe and secure way to save your money while earning interest on it. In most cases, the interest rate offered on a savings account is higher than what you would earn on a transaction account, making it a good option for those who want to earn a little extra on their savings.
Savings accounts may have certain restrictions, such as limits on the number of withdrawals you can make per month, minimum deposit requirements, or bonus interest rates if you meet certain conditions. However, they also offer benefits such as easy access to your funds, government-backed deposit insurance, and the ability to automate your savings through regular deposits. Overall, savings accounts are a useful tool for anyone looking to build up their savings and achieve their financial goals.
As the new year rolls around, many Australians are looking to get their finances in order and start saving for the future. One of the most effective ways to do this is by opening a savings account. But with so many options available, how do you know which account is right for you? In this article, we’ll take a look at some of the best savings accounts in Australia in 2023.
General information on what to look for when searching for the best savings accounts in Australia
- Interest rates: Look for savings accounts that offer high-interest rates. The higher the interest rate, the more you’ll earn on your savings.
- Fees: Some savings accounts come with fees, such as account-keeping fees or transaction fees. Look for accounts with low or no fees to maximize your savings.
- Accessibility: Consider how easy it is to access your funds. Some accounts may have restrictions on withdrawals, while others offer online or mobile banking for easy access.
- Security: Look for accounts that are backed by the Australian government’s Financial Claims Scheme (FCS). This protects your deposits of up to $250,000 in the event of a bank failure.
- Bonus interest: Some savings accounts offer bonus interest rates if you meet certain conditions, such as depositing a certain amount each month. Consider whether these conditions are feasible for you and whether the bonus interest is worth it.
Remember to do your own research and compare different savings accounts to find the one that best suits your needs and financial goals.
Top 5 Savings Accounts to Consider in Australia
Here are the top 5 Savings Accounts to Consider in Australia; UBank USaver with Ultra Transaction Account, ING Savings Maximiser, ME Bank Online Savings Account, RaboDirect High-Interest Savings Account, and Bank of Queensland Fast Track Saver Account.
1. UBank USaver with Ultra Transaction Account
The UBank USaver with Ultra Transaction Account is a great option for those looking for a high-interest savings account that also offers easy access to their funds. With an interest rate of 1.81% p.a. and no monthly account-keeping fees, this account offers great value for money. Plus, if you deposit $200 per month into the account, you’ll receive bonus interest of 1.06% p.a. for balances up to $250,000.
2. ING Savings Maximiser
The ING Savings Maximiser is another popular option for Australian savers. With an interest rate of 1.80% p.a. and no monthly account-keeping fees, this account is great for those who want to earn a high rate of interest without any extra costs. To qualify for the maximum interest rate, you’ll need to deposit at least $1,000 into the account each month and make five or more card purchases from your linked ING Orange Everyday account.
3. ME Bank Online Savings Account
The ME Bank Online Savings Account is a good option for those who are looking for a straightforward savings account with no frills. With an interest rate of 1.85% p.a. and no monthly account-keeping fees, this account offers competitive interest rates without any extra costs. Plus, there are no minimum deposit requirements or withdrawal restrictions, so you can access your funds whenever you need them.
4. RaboDirect High-Interest Savings Account
The RaboDirect High-Interest Savings Account offers a competitive interest rate of 1.80% p.a. with no account-keeping fees. You’ll need to link your account to an external transaction account to access your funds, but the process is straightforward and easy to set up. Plus, there are no minimum deposit requirements or withdrawal restrictions, so you can manage your savings as you see fit.
5. Bank of Queensland Fast Track Saver Account
The Bank of Queensland Fast Track Saver Account offers a competitive interest rate of 1.70% p.a. with no monthly account-keeping fees. To qualify for this rate, you’ll need to deposit at least $1,000 per month into the account and make no withdrawals. However, if you do need to access your funds, you can still do so without penalty – you’ll just earn a lower interest rate.
When choosing a savings account, it’s important to consider your individual needs and financial goals. By comparing different accounts and their features, you can find the one that best suits your needs and helps you reach your savings goals in 2023.
What is the difference between a savings account and a transaction account?
A savings account is designed for the purpose of saving money and earning interest, while a transaction account is used for everyday spending and bills. Savings accounts usually offer higher interest rates but may have restrictions on withdrawals.
How does interest work on a savings account?
Interest is the money that the bank pays you for keeping your money in a savings account. The interest rate is expressed as a percentage of your account balance and is usually calculated daily and paid monthly.
What fees should I be aware of when opening a savings account?
Some savings accounts may have account-keeping fees, withdrawal fees, or other charges. Be sure to read the fine print and understand the fees associated with any account you’re considering.
Are savings accounts insured in Australia?
Yes, savings accounts in Australia are insured by the Australian government up to $250,000 per account holder per institution under the Financial Claims Scheme (FCS).
How can I compare different savings accounts?
When comparing savings accounts, consider the interest rate, fees, withdrawal restrictions, minimum deposit requirements, and any bonus interest offers. Look for an account that best suits your needs and financial goals.