New to term deposits? Here’s the reason why you should try one

By Cameron Thomson · · 2 min read
Fact Checked
Advertiser disclosure
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Knowing what kind of savings vehicle to park your cash in can be overwhelming , especially for those who are just getting started. However, term deposits are one kind of savings vehicle that should be on your radar.

What is a Term Deposit?

A term deposit is a fixed-term investment held at a financial institution. You invest a lump sum of money for a predetermined period, which could range from a month and up to 5 years. During this term, your money earns interest at a fixed rate, which is usually higher than a regular savings account.

One of the main draws of a term deposit is its predictability. The interest rate is fixed, meaning you know exactly how much your investment will earn over its term. This can be particularly appealing in times of economic uncertainty, where other investments might be subject to market fluctuations.

Why is now a good time for Term Deposits?

At the moment, some of the best term deposit rates on offer are sitting at or above 5%. However, the financial conditions that led to these rates are beginning to cool, with recent CPI data showing a slowing rate of inflation. 

So why is this important? Basically, the Reserve Bank is likely to hold rates for the next few meetings. This means that many savings and term deposit providers are likely to adjust rates downward. By locking in a good rate now, you’re ensuring that your money is earning a guaranteed fixed rate for however long you need it to.

How to find a good term deposit rate

There are a couple of ways of finding good term deposit rates, however there are many providers. So, to make the process easy, you can use our term deposit comparison tools to find a provider with the features and rates you’re looking for.

Next up, getting a good idea about the average market rates can help you contextualise rates on offer. Using our database, the Mozo data team has put together some handy averages for all the term deposit rates we compare by term length.

Term
Rate
Term 
Rate
3 month
3.76%
2 years
4.09%
6 month
4.27%
3 years
3.93%
9 month
4.26%
4 years
3.81%
1 year
4.60%
5 years
3.85%

If you’re looking to get started now, you can head over to our term deposit hub page. Alternatively, you can check out some of the providers in the tables below… 

Term deposit comparisons on Mozo - last updated 30 April 2024

Search promoted term deposits below or do a full Mozo database search. Advertiser disclosure
  • Featured Product
    Term Deposit

    5.10% p.a.
    6 months

    $1,000

    Yes up to $250,000

    Great rates and incentives incl. 0.10% added loyalty bonus at renewal. Option to have interest paid to another bank. Winner of the Mozo Experts Choice Awards 2024^ for Term Deposits.

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  • Mozo Expert Choice Badge
    Term Deposit

    4.75% p.a.
    1 year

    $1,000

    Yes up to $250,000

    Enjoy a competitive fixed interest with the choice of 1 month to 5 year terms. Start with as little as $1,000. Interest paid monthly, quarterly, half yearly or yearly. Receive a 0.10% loyalty bonus when you automatically reinvest your Term Deposit before maturity. (Terms and Conditions apply)

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  • Online Term Deposit

    5.00% p.a.
    7 months

    $5,000

    Yes up to $250,000

    No set-up or account keeping fees. Deposits up to $250,000 per customer are guaranteed by the Australian Government. Mozo Experts Choice winner for Term Deposit 2022.

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    Details
  • Term Deposit

    4.80% p.a.
    9 months

    $1,000

    Yes up to $250,000

    Enjoy the certainty of a fixed interest rate combined with the convenience of online banking to set up and manage your term deposit at maturity. You can start investing from as little as $1,000 or up to $5,000,000.

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    Details
  • Mozo Expert Choice Badge
    Term Deposit

    4.85% p.a.
    6 months

    $1,000

    Yes up to $250,000

    Enjoy a competitive fixed interest with the choice of 1 month to 5 year terms. Start with as little as $1,000. Interest paid monthly, quarterly, half yearly or yearly. Receive a 0.10% loyalty bonus when you automatically reinvest your Term Deposit before maturity. (Terms and Conditions apply)

    Compare
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    Details
  • Featured Product
    Term Deposit

    5.10% p.a.
    1 year

    $1,000

    Yes up to $250,000

    Great rates and incentives incl. 0.10% added loyalty bonus at renewal. Option to have interest paid to another bank. Winner of the Mozo Experts Choice Awards 2024^ for Term Deposits.

    Compare
    Go to site
    Details

* Different interest rates apply to different amounts or different interest payment frequencies.

^See information about the Mozo Experts Choice Term Deposit Awards

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