Savings accounts starting with a 4
Last updated on November 11th, 2022
The greyer haired heads among us will remember when you could get a 4% return on any general transaction account. Nowadays it’s a headline if a bank moves a savings account rate above 4% per annum.
Based on our market research there appears to be nine individual banks with savings account rates starting with a 4.
The conditions vary with how they arrive at that figure, however - think deposit and transaction requirements, age limits, growing the balance, honeymoon periods and so on.
Four per cent seems to be the benchmark, whether that’s in the one-year term deposit space or with savings accounts - if you’re a bank and not competing in this space you might as well pack up and go home.
That said a 4% p.a. savings rate is well north of the average - RBA data for October says the average special savings account rate was 2.55% p.a.
It’s similar for term deposits - if you don’t want to do a lot of flip flopping around, there are 17 banks with one-year term deposits over 4.00% p.a.
The next frontier is 5.00% p.a. in the five year space. Already five year rates are flying close to the sun. It’s likely one of the ambitious neo-banks like Judo will be the first to break the 5 barrier.
Still, the RBA says annual inflation could reach 8.0% by year’s end. So you’re realistically losing 4% in purchasing power even with your money stashed in a top savings account.
On the other hand, that’s better than a poke in the eye and we know how the RBA is with forecasts… (sigh)
But as RBA deputy governor Michele Bullock stated at a recent function;
“As the past few years demonstrates, however, it is more often a question of how wrong the forecasts will be.”
Nevertheless, AMP chief economist Dr Shane Oliver thinks we’ll narrowly avoid a recession, largely because of high commodity prices such as gas, which is a hit to household budgets. I’m still not sure if that is something to cheer about or not?
If you dissatisfied with you bank, you should consider both your savings and your home loan. There are some great alternatives out there and it is definitely worth your while to shop around. Click here to talk to a mortgage broker about your home loan >
