What types of savings accounts are there?
There are many savings account options out there. Choosing one to open and use will come down to a few factors, like your financial goals and your age.
No-frills savings accounts
Every bank has a basic, no-frills savings account – for us, that’s our Everyday Saver Account. This type of savings account tends to be quite flexible, simple to use and gives you quick access to cash withdrawals. A basic savings account also has a flat interest rate, meaning you don’t have to meet any additional requirements to earn the maximum interest available.
High-interest savings accounts
A high-interest savings account comes with a bonus interest rate that’s typically higher than a standard account. But there are conditions you’ll need to meet if you want the extra interest paid into your account.
For example, if you have a Future Saver Account, you’ll need to increase your balance by $250 each month to earn the additional interest.
Youth savings accounts
A youth savings account is for people under 18 years old. This type of savings account encourages children and teens to develop healthy money habits.
Our Youth eSaver Account comes with a competitive interest rate to help children and teens grow their savings at a young age.
Goal-specific savings accounts
Some banks offer goal-specific accounts with high bonus interest rates to help you work towards, and achieve, a certain goal. Our Home Saver Account is one such account – you can open an account to help you save for a home deposit by meeting the bonus interest criteria each month.
But the Home Saver Account isn’t just for home deposits – it can be for anything you like, such as a new car or wedding.
Is a term deposit a savings account?
The short answer is no – although it can help you save! A term deposit is where you lock away a sum of money for a set period (the ‘term’) and let it grow over time. It’s a pretty straightforward way to boost your savings.
However, you generally can’t access your money until the term is over. The only other times you can access your term deposit are if you’re experiencing financial hardship or if you give us 31 days’ notice.
The longer your term is, the higher your interest rate might be. So if you want to guarantee your money will grow over a longer period, then this type of account might be suitable for you.
What should you look for in a savings account?
- No fees: Choose an account that has no upfront or ongoing fees associated with it. Our savings accounts come with no monthly or annual fees for account keeping. Growing your money without unnecessary costs? That’s what we like to see.
- Easy access to your savings: If you want to withdraw or transfer your savings at the drop of a hat, then pick an account with easy access. Our banking app allows you to transfer your money between accounts seamlessly. You can also use the app to nickname your accounts and see your balance at a glance, making it easier for you to stay on top of your savings.
- High interest rates: Opening an account with the highest interest rate possible means you can earn money just by saving. But remember, some high-interest savings accounts come with conditions you’ll need to meet to earn the extra cash.
- Clever saving features: Check if your savings account comes with handy features to help you be a savvy saver. For example, The Boost can help you increase your savings each time you make a purchase with the Visa Debit card that’s linked to your Everyday Edge Account.
How to choose a savings account that’s right for you?
At the end of the day, choosing the right savings account comes down to what you need from it. Are you saving up for a big goal, like a home deposit? Or do you just want a safe place to stow your money?
Understanding why you want a savings account can help you narrow down your options considerably – even if you use it for casual saving.
For example, if you’re saving for a wedding, a goal-specific, high-interest savings account might help you grow your funds faster. But if you don’t want the added pressure of meeting the criteria, then a standard savings account with no additional requirements might be the way to go.
If you’re unsure about which savings account is right for you, then use our savings account comparison tool. It shows you all the different savings accounts we offer, so you can find the one most suitable for your needs.
Three common myths about savings accounts
1. You have to be buying a home for a Home Saver Account
Nope! We pride ourselves on helping all Australians buy their own home, no matter what that looks like to them. That’s why we offer our Home Saver Account.
But you don’t actually need to be buying a home to open it.
The key thing for this account is that there are specific conditions you’ll need to meet to earn the bonus interest. It’s this additional cash that can help you work towards your goal – whether it’s a home deposit or something else entirely.
2. You need to have a large deposit to open an account
Absolutely not. You can open a savings account with as much or as little money in it as you like. The point of a savings account is to grow your money. It’s okay to start small and watch your savings thrive through regular deposits and interest rates.
3. You need to earn a certain amount of money to save
Not at all. You don’t need to be a high-income earner to open a savings account. And regardless of your salary, you can open a savings account whenever you like.
Growing your money comes down to having a good budget and money management skills. Even if you start small by depositing a couple of dollars a week, it can all add up pretty quickly.