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Your term deposit and interest
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Your term deposit and interest
To get an accurate idea of how much your term deposit will be worth in a certain amount of time, use our term deposit calculator. Simply fill in the categories for how much deposit you have, the interest rate, and the number of years into the term deposit calculator and it’ll show you how much money you’ll have at the end of that period.
Once you’ve seen how your money can grow, use Mozo’s term deposit comparison tool to see which bank or credit union can provide you with the best term deposit for your needs.
It is also a good idea to also review current savings accounts interest rates if you’ve got money to invest. While savings accounts have variable interest rates, they can often be higher than term deposits, especially if you are only looking to invest in the short term. Just make sure that you can meet any deposit requirements for bonus interest as the standard interest rates are usually lower.
One great things about term deposits offered by Australian banks is that they usually have a range of terms you can choose from to best suit your savings goals. You can lock away your funds for as short as one month or as long as five years. By using our term deposit calculator on this page you can easily input different amounts and terms to see which option will be good for you.
The term that is best for you will depend on your personal savings goals. Both options have their benefits and drawbacks. Short term deposits may be ideal if you’re someone who relies on your savings for income. Short term deposits generally come with lower interest rates and you may only have access to the interest at maturity.
Longer term deposits may be better suited to someone who can afford to part with their cash for a longer period of time. Plus, these term deposits typically come with higher interest rates and have more flexibility around when the interest gets paid out, either on a monthly basis or at the end of the term.
Term deposit interest rates will depend on three things, the bank you choose, how much you are investing and how long you choose to lock away your funds.
It’s also worth noting that term deposit rates are fixed rates. This means that no matter how the market behaves over the period that you have your term deposit, the interest rate will remain the same, as will your return.
Interest is calculated by dividing the per annum interest rate by 365 to get the daily interest rate, then multiplied by the number of days of the term deposit investment term.
You can get a quick snapshot of the overall interest you can earn by using our term deposit calculator.
While it might have made sense in the past to head to big banks for term deposit options, the market has come a long way. You’ll be able to open a term deposit with not only Australia’s big four banks, but credit unions and online challenger banks.
That’s why it’s important to take the time to shop around and compare term deposits to guarantee you’ll be getting the best bang for your buck for your investment.
All term deposit providers that we have in the Mozo database are covered under the Government Financial Claims Scheme. This scheme protects deposits in savings, bank accounts and term deposits, up to $250,000 per customer per Authorised Deposit Institution.
If you need to end a term deposit early you’ll usually have to pay a fee. This fee will be calculated by your bank and will be based on how early in the investment term you wish to withdraw your funds.
Automatic rollovers are a common feature with many term deposits. Once your term deposit closes in on its maturity date, unless you let your provider know in advance what you intend to do with the funds, they will automatically reinvest your money with the same term on your behalf.
If you are considering reinvesting your funds, to make sure you’re still on the most competitive deal use Mozo’s term deposit comparison tool to compare your options first.