Mozo guides

What do you need for a term deposit?

an hourglass with coin stack next to it

One of the great things about a term deposit is that it’s not only a low risk way to earn a return on your savings, but also a pretty low maintenance one. That doesn’t mean there aren’t some great tricks to making your term deposit work harder for your money - but it does mean that opening a term deposit is a pretty stress-free process.

Here are some of the important things you’ll need when opening a term deposit:

Your contact details

You’ll usually have to list both a phone number and email address when you open a term deposit, especially if you’re applying online. It’s important to give accurate details and update them when necessary, because this is how the bank will remind you when your term deposit is about to mature.

Your I.D 

Often you’ll need to provide some form of photo I.D, such as a Driver’s licence, Medicare Card, or passport, particularly if you’re new to the bank when you sign up for a term deposit. One of the reasons for this is proof of age, although age limits on term deposits are pretty lenient - some offers are available to savers as young as 12.

Member number

If you bank with a mutual or credit union, you’ll need to supply your member number. If you’re not a member already, chances are you’ll have to sign up. Keep in mind, there might be a small membership fee involved.

A savings/bank account

You’ll need an account for the interest from your term deposit to be paid into. This shouldn’t be an issue if you’re opening a term deposit with your current bank, but sometimes, it won’t have a great term deposit offer, and you’ll want to head elsewhere to find a place to stash your cash. Be sure to check if your new provider will pay interest into your old bank or savings account - some won’t and you’ll be required to open a savings or bank account along with your term deposit.

A minimum deposit

Many term deposit offers come with a minimum deposit requirement attached - often around $1,000. You’ll need a lump sum of at least that much before you look at opening a term deposit. Remember, you won’t be able to withdraw from or deposit into your term deposit after the initial deposit, so make sure you think through how much you’re going to lock away before taking the plunge.

A desired term

You can choose to take out a term deposit for a relatively short term, between 1 month and 1 year, or for a longer term - up to 10 years in some cases. The important thing is to consider your budget and future plans before you decide, and make sure it’s a length of time you can stick to. The last thing you want is to be making an early withdrawal from your term deposit.

A budget

Because a term deposit is a long term commitment, it’s important to have a budget in place before locking in. The reason is twofold; one, you need to make sure your budget isn’t relying on the funds you’re locking away, and two, you should have enough funds left outside of your term deposit to cover an emergency. That way, you’ll be much less likely to have to make an early withdrawal.

A future savings plan

When your term deposit matures, whether that’s a month from now or ten years, you’ll need to have a plan in place for what you want to do with the funds. It’s important to know whether you want to withdraw the money and start using it again, or re-invest it for another term, because if you forget to make arrangements, your money will often automatically roll over into another term. These rollover terms often have much lower interest rates than your original, and you’ll be locked in for the full term again.

Top term deposit tips

woman figuring out how much money to put in her term deposit
  • Remember to do your research. One of the most important things when setting up a term deposit is to do some research and work out just what you need and what will work best for you. Read up on things like the types of term deposits available, the features of term deposits and lots more in our term deposits guide section.
  • Crunch the numbers. Once you lock a term deposit in, you won’t be able to change it - you can’t add more funds, snag a new interest rate or bag some bonus offers to boost how much interest you earn. So before you commit, crunch the numbers with our handy term deposit calculator and work out just what the return on your savings will be and if it will meet your savings goals.

How do I apply for a term deposit?

When you’ve got everything you need, you’re ready to apply. It’s generally pretty easy to do - usually you apply online, over the phone or in a branch, depending on which bank you choose.

How do I transfer funds into a term deposit?

Once you’ve decided how much you want to lock away and for how long, there are a few different ways to transfer money into your term deposit account.

A term deposit works like a normal account in that it has a BSB and account number.  And like a normal, everyday account most banks allow you to transfer through your online banking app, via telephone, in-branch or using BPAY.

Many banks recommend transferring money through the online banking app, as it’s often the fastest and easiest way to get the funds across.

The only difference between transferring into a term deposit and transferring into a bank account is that once you have transferred funds into your term deposit you can’t access them again for the period of time you have chosen.

The electronic bill payment service BPAY also tends to be a popular method of transfer for a number of banks. In this instance your bank would give you the required information, e.g. the BPAY biller code, customer reference number, amount and date and you would pay the amount as you would a normal bill from within your online banking app.

It should also be noted that most banks have more options for transferring money into your new term deposit account when you first apply or whilst you are in the process of setting it up; some banks only give the option to deposit or transfer money in-branch while you are setting up your term.

The best thing is, once you’ve done all the hard work and transferred money into your term deposit you can sit back and watch the interest grow until the term ends.

You can start comparing term deposits below. Alternatively, you can check out the Mozo Experts Choice Award Term Deposit winners to make you your search a bit easier. 

Maria Gil
Maria Gil
Money writer

Maria Gil writes across all of our personal finance areas here at Mozo. Her goal is to help you think smarter about money and have more in your pocket. Maria earned a journalism degree in Florida in the United States, where she has contributed to major news outlets such as The Miami Herald. She also completed a masters of digital communications at the University of Sydney. When Maria isn’t busy with all things finance, you can find her tucked away reading fantasy books. She is also ASIC RG146 (Tier 2) certified for general advice.

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

^See information about the Mozo Experts Choice Term Deposit Awards

Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.

While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.