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Term Deposits vs Savings Accounts

One of the common questions I receive from those people wanting to invest in cash is “What is the difference between a term deposit and a  savings account?”

Term Deposit (Term Investment)

With a term deposit your money is locked away for a set period of time. You choose the timeframe you want to invest for (usually from one month to five years). The rates may be different rates for different time periods and, depending on the term you choose, interest is paid monthly, six monthly or at maturity.

 You can open a term deposit with as little as $1,000.

 If you access your funds you break the term and you receive a reduced interest rate.

Explore Term Deposits

(Bonus Saver) Account

This account is like an everyday savings account but you must make at least one deposit and no withdrawals in a calendar month to receive bonus interest. If you don’t, you don’t earn interest for that month only, giving you a little more flexibility than a term deposit.

You also don’t need as much money to open this account as you do a term deposit – it can be as little as one dollar.

It is a good idea to arrange an automatic payment into the account from your pay or other accounts. Free internet and phone banking allows you to can help you keep track of how your savings are going.

Explore Bonus Saver

This article is intended to provide general information of an educational nature only. This information has been prepared without taking into account your objectives, financial situation or needs. Therefore, before acting on this information, you should consider its appropriateness having regard to these matters and the product terms and conditions. Terms, conditions, fees, charges and credit criteria apply. Information in this article is current as at the date of publication.

Compare the two - Term Deposit and Bonus Saver

Compare 2 products
Term Deposit
Lock in a competitive interest rate at a term that suits you – from one month to five years.
Bonus Saver
We think saving should be simple, so our Bonus Saver rewards you for your good saving habits.
Interest rate 4.75 % p.a.
6 months - $5,000 and over - Interest on maturity
Bonus interest 4.00 % p.a.
Calculated daily, paid monthly
Key Features
Investing money at a good rate of interest which is guaranteed not to change.
Invest a fixed amount of money, for a fixed number of days, at a fixed interest rate.
Fixed interest rate.
Interest calculated daily and paid either monthly, 6-monthly, or at maturity (subject to the term chosen).
Key Features
Can be used for general or targeted savings.
Make at least one deposit and no withdrawals in a month and you earn interest on the entire balance.
Variable interest rate.
Interest calculated daily, paid monthly.
Minimum amount to open
$1,000
Access to money
Locked away for the specified time period
Term of investment
Choose from 1 month to 5 years
Interest frequency
Calculated monthly, six monthly or at maturity, depending on term
Can be managed through our app or online banking?
Monthly account keeping fees
Can be opened online?
Minimum amount to open
$1
Access to money
At call BUT if you don’t make at least one deposit or you make a withdrawal in a calendar month then you do not receive interest
Term of investment
Ongoing – as long as you keep the account open
Interest frequency
Calculated daily and paid monthly
Can be managed through our app or online banking?
Monthly account keeping fees
Can be opened online?
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