The best savings account will be one that offers the highest interest rate, the lowest fees and terms and conditions that aren’t restrictive and fit in with your lifestyle needs. Savvy can help you find the best bank account by providing simple, easy-to-understand comparison information, including the following:
Fees
Look for savings accounts which have no monthly fees and no annual package fee. There should also be no withdrawal fees if you decide to transfer money from your savings account to your transaction account. Compare charges to make sure you find an account which offers the cheapest solution to your banking needs.
Interest-earning savings accounts
Many pensioner savings accounts offer tiered interest, which means the interest rate changes and increases the more you have in your savings account. For example, for amounts up to $10,000, the interest rate may be 0.5% p.a., for balances between $10,000 and $100,000, the interest rate may be 0.8% p.a. and for accounts with over $100,000, the interest rate could be 1% p.a. Some savings accounts specify that a minimum amount must be deposited each month to qualify for a ‘bonus’ additional interest rate, so watch out for any conditions which may apply when comparing accounts.
‘Locked’ savings accounts
These offer a slightly higher interest rate on the condition that no withdrawals are made on the account that month. They effectively lock your savings away in return for earning more interest. These accounts can offer a good incentive to keep your savings in place but beware of restrictive conditions that specify if withdrawals are made that no interest is earned on your savings for the month.
Term deposits
These are cash deposits which a saver agrees to leave with their bank for a specified period, which is known as the ‘term’ of the deposit. The longer the deposit term, the higher the interest rate offered. Pensioners can decide to park their savings in a term deposit ranging from just one month up to several years (typically a maximum of five). During this period, the money is locked away and no withdrawals are permitted at all. In a low-interest environment, term deposits may offer the highest interest rates available.
Accessibility
It’s important to consider how accessible the account is for you. Is it linked to a debit card or even able to be added to your digital wallet on your smartphone? If you’re an individual who prefers to carry cash around, how many ATMs are available for you to use fee-free, and will you be charged fees for withdrawing from machines operated by other institutions?
