Types of Bank Accounts

The type of account that’s best for you will depend on your demographic and how you intend to use your account.  It will also depend on whether you’re looking for an everyday transaction account, a savings account, an offset account or a term deposit (which is a longer-term savings option).

Everyday transaction accounts are primary, everyday accounts which allow you to pay bills, shop and spend.  They usually don’t earn any interest, and often have monthly account-keeping fees.

Savings accounts, which are often linked to a transaction account, are where you store your money to earn interest and to save up to buy big-ticket items such as cars and overseas holidays. 

A term deposit is a deposit for a set period which often gives access to a higher interest rate. 

An offset savings account reduces the interest you pay on your home loan by offsetting the principal amount you borrowed to buy your property.

Here are some ideas to help you further narrow down your choice of accounts:

• If you’re an Australian student: some special youth or student accounts offer fee-free or low-cost banking plus free ATM withdrawals.
• If you’re an overseas student studying in Australia (or intend to travel): look at an international account, also known as a global bank account, which may allow you to make deposits in multiple currencies and save money on international money transfers
• If you’re about to buy a home: use Savvy to compare various home loans and consider opening an account with the lender you’d like to approach for your loan
• If you own your own business: business bank accounts offer more frequent, detailed statements and access to accounting tools online to assist with account reconciliation on large volumes of transactions
• If you want to open an account with another person: there are special joint accounts for couples or friends who both want to share or access the same account
• If you’re a young person: you could look at accounts aimed either at children, youth or students, depending on your exact age. Children’s accounts (also called junior accounts) tend to be joint parent and child accounts for kids up to the age of 12.  After this age, there are youth accounts which you can generally use up to the age of 18, 21 or even 25. All of these accounts for young people tend to be fee-free, and some come with bonus interest deals to help your savings grow faster.
• If you’re over 65: pensioner or concession transaction accounts often have low or no fees, with some doing away with overdrawn fees as well. Some also offer bonus interest on a savings account if you get your pension or monthly super income paid directly into a linked transaction account. 

Savvy can help you narrow down your choice of bank accounts by presenting you with clear and easy-to-understand banking comparison information.  Compare accounts side by side until you find one that has the best possible interest rates and all the features you’re looking for.