There are hundreds of savings products on the market and the chances are that if you look around you will find a better deal. The best place to start is to take a look at the return you are getting on your money so check the interest that is being paid on your account and compare it to other savings products.

While interest rates are the first thing you should look at, and are a good indicator, they are not the only thing you need to take into account. Look closely at the fees charged by your existing savings account and competitors. There are plenty of high interest savings accounts around that charge no fees at all so you can afford to be choosy.

Another factor you should look at is how interest is calculated and paid. The more frequently it is calculated, the faster your money will grow so look for an account where interest is calculated daily and paid at least monthly.

Interest rates and the return investment is probably the most important consideration when determining whether you have the right savings account, but it is not the only one. A lot will depend on your personal circumstances and how much flexibility you are willing to sacrifice.

For example, if you really want a high return on your money you could consider a term deposit. These offer good interest rates but basically amount to binding contracts with banks. With term deposits you will be required to make a minimum deposit, you will be limited in how much you can lodge, and you will have little or no access to your money until the contract is complete.

In general, there is a direct trade-off between returns and flexibility. The more access you want to your money the lower the returns on your investment. If you can afford to make a large initial deposit and won’t need to access your money for a year or two, you can find some excellent rates of return.

However, if you do not want to make a minimum deposit and want access to your savings when you need it, you should examine online high interest savings account. These accounts, which can only be opened and managed on the internet, offer the best of both worlds – high interest rates and a good deal of flexibility.

A good online high interest savings account should also offer free, or no, fees and charges, have telephone and online banking facilities, and allow you to link your savings account to any other accounts of your choosing. Many of them will also allow you to open an account with no minimum deposit and access your money whenever you want.

So, the best savings account for you depends on your personal preferences. There is a product out there to suit every situation, so you can get your money working for you.

Have You Got the Right Savings Account? is a post from: High Interest Savings Accounts

The deposit instruments most accessible to the average bank customer are term deposits and high interest savings account products. Each one has its place in your mix of deposits.

term deposit

A term deposit requires you to place a certain amount for a set period; in exchange, the bank or financial institution agrees to pay you a fixed return on your money. The period may vary from a month to as long as five years. The interest yield is higher than ordinary savings accounts.

Term deposits for five years will earn higher interest than those placed for one month. Also, the bigger the amount placed in term deposit, the higher the interest rate you receive. Once you have opened the term deposit, you can no longer make additional deposits to it so you need a substantial amount to start one.

Term deposit is the way to go if you really want to save but find yourself unable to resist the temptation to use the money in your savings account. Since the money is locked in for the agreed period, it is inaccessible to you in the meantime. Of course, if you insist, the bank can release the money to you; be aware though that early withdrawal means you will forego the high interest rate.

If you wish to set up a term deposit, it will be prudent to get a clear idea of how long a period you can spare the money. This will help ensure that your money earns the desired high return but is locked in only for as long as you want.

high interest savings account

A high interest savings account is another way banks encourage you to save. There usually are conditions attached to the high interest savings account offer: at least one deposit but no withdrawals should be made within a given month in order to earn a bonus interest. There may also be a required minimum balance. If you don’t qualify for the bonus rate in a certain month, only the standard interest is applied for the month – and that is a very low rate. For example, the bonus rate is 3.01 per cent but the standard rate is only 0.01 per cent on the Commonwealth Bank Award Saver.

You need a sizable amount to open a term deposit, but you can start a high interest savings account with very little cash. The idea is for you to add more money into it every month without drawing any money from it. If you do need to withdraw, you lose a smaller amount of interest than from a term deposit and only for the specific month. With the high interest savings account, therefore, you have more flexibility than a term deposit.

Both types of deposit are good for you, but you’ll have to use them appropriately. When you have substantial cash to spare, a term deposit is the perfect way to make it grow faster during the period you don’t need it yet. When you have enough money left over from your transaction accounts but it is neither enough nor advisable for placement in a term deposit, the best alternative is a high interest savings account.

Savings Account or Term Deposit? is a post from: High Interest Savings Accounts

Until January 2009, online savings accounts offered rates of 8 per cent or higher during a promotional period then reverted to about 7 per cent or so afterwards. Things changed in April. With the historic lows in the Reserve Bank of Australia’s official cash rate, there has been a corresponding decrease in yields for online savings accounts to about 4-4.75 per cent. But after you compare savings account interest yields, online savings accounts still come out on top. This higher yield comes together with other advantages you get from online savings accounts including:

• Convenience, since you have real-time, all-the-time access to your cash and you don’t need to line up in a long queue
• Less cost, since it is cheaper to transact online than over the counter at the bank branch.

While there are definite advantages you get in an online savings account, it is important to know how they work and what restrictions exist, if any.

In principle, the online savings account in one bank can link up to any transaction account you keep at any other bank. But you’ll need to compare savings account policies among banks. The big banks and several other operators require both the transaction account and the online savings account to be with the same bank.

Since the two accounts are linked, it is possible to transfer money between them. You will be asked for transaction passwords to ensure the authenticity of the transfer. If the online savings account is in a separate bank from the transaction account, it may take a day or so for the transfer to be completed. When the two accounts are in the same bank, the transfer is instantaneous.

As you compare savings accounts, you also need to watch for special conditions to qualify for the bonus rates offered in the online savings account. With some banks, it is necessary to deposit a minimum amount each month, otherwise you forego the bonus rate and only the normal rate will apply. The idea really is for you to build up your savings. The online banking facilities enable you arrange regular transfers of a pre-set amount from the transaction account to the online savings account.

There may also be limitations on the number of withdrawals you can make – very often, no withdrawals are allowed. If the transaction account and the online savings account are in one bank, the balance in your online savings account will count as part of the minimum balance needed to qualify your transaction account for exemption from fees.

Keep your eyes sharp for how long the bonus rates will last. Some high bonus rates on offer may run for only three months; others may last only one month. You’ll need to check the normal (basic) rate to see if it’s worth the trouble.

Moving to an Online Savings Account is a post from: High Interest Savings Accounts

The days to secure the best savings rates seen in over a decade are numbered in Australia as banks start to lower their rates in anticipation of an expected cut by the Federal Reserve bank next month.

In the past couple of weeks the 12 month term deposit rate for the BankWest tddirect account has been cut by a total of 0.65% – far more than the expected 0.25% fall in rates from the RBA. The td direct product did have a rate of 8.75% for 12 months, this then fell to 8.50% and this week has gone down again to 8.10%. Despite these falls this Bankwest savings product remains one of the more competitive offers on the market.

Raboplus savings accounts rates for their online savings account product have this month fallen from 8.0% down to 7.3%.

There are still some great offers available with the BankWest Telenet Saver offering a rate of 8.50% until Jan 09 and St.George offering a rate of up to 8.10%.  Judging by what has happened so far though it is likely that banks will be quick to reduce rates in line with any fall so now is a good time to secure one of the savings account offers still offering a top rate.

Last chance to secure best interest rates is a post from: High Interest Savings Accounts