Comparing Savings Accounts
Each of us have different reasons as to why we are opening a savings account. You may be saving up for an emergency fund, a home deposit, a car, a vacation, or simply for the future.
Having a savings account is a safe place where you can park your money while also giving you the opportunity to earn interest. Comparing savings accounts can help you get the highest rate for your savings making your hard earned money work even harder for you.
Apart from a high interest rate, here are the things to keep in mind when comparing different savings accounts:
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Introductory term: Financial institutions will often offer introductory rates for opening an account with them. These rates are quite high and usually last between three to six months. After this, it will go back to their regular interest rates. Introduction rates can be advantageous when you are opening up a new account to help maximise your interest earnings.
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Account balances: Some accounts will require a minimum balance to open and keep the account. If your current balance is below the minimum, you might get penalised. So it’s also important to keep in mind the minimum as well as the maximum balance you can have in your account.
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Minimum monthly deposit: There will be a minimum amount you need to deposit every month for some savings accounts, while others will not require any. Check if the account you want to open will have this feature.
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Account keeping fee: Some accounts will charge you for maintaining your account, while others will be completely free.
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ATM: This will depend on your preference, if you’d like to connect a debit card with your savings account so you can withdraw your money conveniently when needed.
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Service: Customer service will also play a part when you’re comparing different savings accounts. Check if the financial institution is offering an online application, and if their online features in managing the account will fit your needs.
Savings Account Comparison FAQs
You can put your money in a high interest savings account, or in an account that compounds interest so you can earn money on top of previous interest earned.
Where you keep your savings will depend entirely on your individual financial circumstances. For a safer option, you may consider a high-interest savings account or a term deposit account. However if you are willing to take on a little more risk for a higher return, you could consider a mutual fund.
It is considered safe to park your money in a savings account rather than having it in cash. Most institutions in Australia (including all authorised deposit taking institutions) are government guaranteed, meaning your funds will be guaranteed by the government depending on the type of account you deposit your funds into. Ask your bank to see if they are government guaranteed if you would like extra peace of mind.
It is worth it to have a savings account to keep your money safe and earn interest at the same time.