Tips for making the most from your savings accounts!

It can be hard to know what to look for when it comes to picking the right account for you savings, so here are a few things that might help you make your decision

Understanding the different types of accounts and how you can ensure they aren’t eaten up by fees and inflation can be tricky if you haven’t done your homework. If you do decide to switch up your accounts it also pays to be mindful of the impact moving your money around.

TODAY chatted to Consumer Campaigner Christopher Zinn who has done the research and has some tips. 

TODAY: Why is selecting the right account so important?

ZINN: Because we need to take care of our savings to ensure they are not eaten up by inflation and fees and they are there when we need them. There are people who have large amounts of savings but in the wrong kind of account at lower interest rates than they could get and it’s costing them dearly. It’s a question of checking out the terms and conditions not just being drawn in by the honeymoon rates. Generally if you have more funds and are prepared to have them locked up for longer you will get a better return — also because rates are very low at present and you need to make the most of what you can get.

TODAY: Take us through the best internet savings account?

ZINN: Internet savings accounts have some limitations, such as no ATM or branch access, but for ease and better returns they are worth looking at. You may still need a transaction account to pay bills and do day-to-day banking which can be linked to this account. There are many too choose from and commercial comparison sites can help you go through the terms and conditions to see what suits you best.

TODAY: How about traditional savings accounts?

ZINN: Given low interest rates are good for some, such as home loan borrowers, they are not such good news for depositors and the good old savings account can be pretty lean when it comes to the rates they pay. Indeed while they might have the name Saver in the title these financial products can pay standard interest rates, ie not the bonus or introductory or conditional rates which can seem much higher, of a very low rate—well under 1% . The conditions can include how much you have to deposit a month and how many withdrawals you are allowed.

Traditional savings accounts from
1. Bank of Queensland Websavings Account 1.30% (standard variable rate)
2.Bank Australia Bonus Saver Account 0.15%
3.Bankwest Hero Saver 0.01%

Note all interest rates are the base rates which are very low for some of the traditional savings.

TODAY: If you’re considering making a switch, what do you need to remember?

ZINN: Easy to move unless serve out term deposit. Work out benefits of honeymoon and base rates and remember to stay active as the market moves your funds can too!

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