Looking to lock away some cash for the short or long term? Mozo can help you get the best return on your money. We compare term deposit interest rates from 70 banks to help you find the best term deposit for your investment needs.
Understanding how term deposits work is the first step to finding the best bank term deposit for you. Term deposits work much like a savings account, in that you earn interest on the money you put in the account. The catch is, you can’t access the money for a set ‘term’. In return, you often receive a better interest rate than if you were to put the money in a savings account.
There are short term or long term options for locking your money away in a term deposit here in Australia. Most banks offer term deposits which range between 1 month and five years. The longer the term, the higher your interest rate will likely be, and the more you’ll earn on your deposit. Once you’ve chosen your term length and amount, head below to compare bank interest rates for term deposits in Australia.
What can I do to get the best interest rate for my term deposit?
There are many different factors that can affect the interest rate you receive. Everything from your term duration and deposit amount, to the bank you choose will play some part.
Use our comparison table below to compare interest rates between banks. For a customised listing based on your deposit amount and desired investment term, check out our term deposit search. We’ll compare all the Australian banking providers in our database and show you a listing of the interest rates available.
Should I put my money in a term deposit or savings account?
Term deposits and savings accounts are both great ways to save some extra cash for the future.
Term deposits are best suited to those who know they won’t need access to their money for a set time period. Interest is generally higher than that of a savings account, but be aware that if you do need to take out your money before the end of the term you could be made to pay break fees.
An high interest savings account is a great option for those that need regular access to their money. These accounts are more flexible than term deposits, allowing you to add and withdraw money at any time. Some savings accounts have interest rates that are similar to term deposits so depending on your savings goal they could be a good option.
firstmac High Livez
Highlivez Bond Fund – return of 5.96% p.a.*
Invest in highly rated Australian bonds. *Total Return for the 8 years to 31 July 2019 and 6.10% p.a. since inception on 29 March 2011. Past performance is not indicative of future performance. The fund is not a bank or term deposit.
Term deposit comparisons on Mozo - rates updated daily Mozo has robust processes to ensure our site is updated to reflect the latest information from providers. There may be the odd occasion where updates are delayed, so please confirm information before purchasing.
Safe & Rewarding: Great rates and incentives incl. 0.10% added loyalty bonus and while Judo Bank Term Deposits work for you, they work for Aussie businesses too. All eligible deposits you have with Judo Bank up to $250,000, are guaranteed by the Australian Government under the Financial Claims Scheme.
A higher competitive fixed interest rate than comparable ANZ Term Deposits. You will need to give ANZ 31 days notice if you wish to withdraw the money prior to maturity. With a minimum investment of $5,000 you can enjoy the certainty of fixed returns over your investment term
Your savings will be matched to a portfolio of renewable energy projects like wind, solar energy and low carbon buildings. No fees whatsoever. Choice of 2, 5, 7, 8, 10, 11 month terms for deposits from $1,000 - $2 million.
With a minimum investment of $5,000 you can enjoy the certainty of fixed returns over your investment term. Choose the length of term from one month to five years. Receive interest payments monthly, quarterly, half yearly or annually on selected terms.
Are you looking for more bang for your buck? If you're not a risk taker and would rather take a conservative approach when it comes to your money, a term deposit might just be your answer.
With your money locked away for a set period of time at a fixed interest rate, a term deposit will allow your savings to grow without lifting a finger. A term deposit works especially well for those who often dip into their savings. It's hands off until the term has ended! Let's take a look at all the things you need to know when choosing a term deposit.
Term refers to the duration of the investment. There are two main types of term deposits that banks offer, Short-term and Long-term. Take the time to consider your financial goals and this will help you decide which term is best for you. For example, are you looking to purchase a car sometime in the next 12 months or are you planning an overseas holiday?
Short-term deposits: Stash your cash for as little as three, six or even twelve months. With shorter terms, the banks are more likely to offer a lower interest rate. If you need to access the money in the near future, a short term deposit may suit you better. Check out the best short term deposits on offer by using our Term Deposits Search Engine.
Long-term deposits: A long-term deposit is any period from one year up to say five years. It's likely to be the best interest rate going around. It's ideal for the sensible saver who's looking for continual growth in their savings with no risk. Have a look at Mozo's in-depth list of long-term deposits
Some financial institutions will offer rollover term deposits. This gives you the option of rolling over your investment for another term. So, sit back and watch your savings grow even more. Always check that on that particular term deposit at the time of rollover, you are being offered the best interest rate.
ALSO REMEMBER – There are penalties for early withdrawals from any term deposit!
Unlike a home loan where you choose between a fixed or variable interest rate, a term deposit is fixed i.e. the interest rate will not change. Therefore, if interest rates drop, you don't need to worry when you have a term deposit.
Take the time to work out what you want from your fixed term investment. For once in your life you are given permission to shop, shop, shop! Look around and find the best interest rate to suit the amount you are investing and the most suitable duration of your term deposit.
For the best term deposit interest rates in Australia, search the Mozo term deposits database. This includes Australia's major banks, credit unions and financial institutions.
Term Deposits vs Savings Accounts
It's the old age question… what should I do with my money? Is it best for those lifelong, hard earned savings to be invested in a term deposit or just sit in a savings account?
If you're a 'commitment phobe' then a term deposit may not be for you. Therefore, opt for a high interest savings account which is much more flexible and accessible
Penalties apply if you withdraw money from a term deposit before the term has ended. There are no fees for taking out money from a savings account
You can't make additional payments to your term deposit. Savings accounts can be topped up when you like i.e. daily, weekly, monthly etc
The bank has the potential to change interest rates on savings accounts, including offering less interest. Variable interest rates means your interest can suddenly drop. Interest rates are fixed with a term deposit, so it's a safer place to park those extra savings.
What to consider when choosing a term deposit that suits you
With all the financial institutions offering term deposits it can be a little overwhelming as to which one to hand your money over to. Read some term deposit reviews!
Financial Goals: Have a good think about your financial goals and what you're hoping to achieve with that hard earned money. Throw some figures in the Mozo budget calculator!
Terms: When might you need to access all those savings? If it's in the near future (three months to a year), go with a short-term deposit. Any longer, opt for a long-term deposit. Have a play with our term deposit calculator to see how longer terms should increase your earnings.
Interest Rates: Shop around and find a good interest rate to suit your chosen term. To save time and avoid frustration Mozo has made things a lot easier for you.
Unfortunately you're dreaming if you think the bank might pay interest weekly! Sadly, the banks were clever enough to change the headline interest rate according to the payment period, so you can't sneak in a better deal by choosing a shorter timeframe.
For short-term deposits, interest is usually paid at the end of the term. When it comes to long-term deposits, interest is likely to be paid annually.
The interest payment method is typically via direct credit into your nominated account. In some cases the financial institution that holds your term deposit may pay the interest to another bank of your choice.
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.
The good news is there are no set up, ongoing or annual fees with term deposits. Believe it or not the banks have actually set you free from fees! But always be sure to check the fee details with your bank before signing the dotted line.
There are however hefty penalties for withdrawing your savings before the term has matured. Do everything you can to avoid the EARLY WITHDRAWAL PENALTY.
Some accounts allow a partial withdrawal of your term deposit; others require a full withdrawal. In either case, the banks hit you with:
The Australian Government guarantees term deposits of up to $250,000 with Authorised Deposit-taking Institutions (ADIs) such as your bank, credit union or building society. So if anything unforeseen happens to your ADI, you are covered.
So, having decided on your term, interest rate and bank, it's now time to set it all up, and watch as your savings increase without you lifting a finger. Here's what you need when applying for a term deposit:-
Name, address, phone number
Proof of identification e.g driver's licence plus Medicare card
Your tax file number
Details of your nominated bank account from where the funds will be transferred
Details (if any) of any other people who will be noted on the Term Deposit.
I like this bank because it offers great rates for a small investment. Setting up the term...
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I like this bank because it offers great rates for a small investment. Setting up the term deposit was very straight forward and easy to organise, and if you need to make any alterations a simple phone call will suffice. I found the process easy and simple to complete.