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Before you choose a 5 year term deposit account, compare the interest rates and features of a wide range of accounts in this guide to ensure you get the best possible deal.
fixed for 60 months
Earn a 0.10% p.a. loyalty bonus when you roll over your term.
The Judo Bank Term Deposit term lengths range from three months to five years. Minimum opening deposit is $1,000. No account-keeping or set-up fees to pay.
5 year term deposits offer the security of a fixed interest rate and provide guaranteed returns on your investment. Also referred to as 60-month term deposits or long-term deposits, these accounts offer protection against any interest rate cuts that may occur.
Unlike a savings account, term deposits are set up so that it is impossible to access the funds in your account without incurring high fees. This removes the temptation to dip into your savings on a whim, instead providing an incentive for you to invest your money for the full 5 year term.
With a term deposit, you invest your money for a set period – in this case five years – and earn a fixed interest rate during that time. Interest can be paid monthly, quarterly, half-yearly, yearly or when the deposit matures. The interest rate is guaranteed not to change for the life of the deposit.
The interest rate on a term deposit remains the same until your account matures, which means you are protected against interest rate falls but you can’t take advantage of any rises that may occur. So if you think interest rates are unlikely to increase at any time in the next five years, investing in a 5 year term deposit could be a good idea. Once the deposit matures at the end of the 5 year period, you can either withdraw your funds or roll them over into a new term deposit.
Term deposits are offered by a huge range of banks and other financial institutions across Australia. This means there is plenty of competition in terms of interest rates and it could be worth your while to shop around for the account that offers the best deal.
Term deposit | 5 year interest rate |
---|---|
Rabobank Online Savings term deposit | 0.7% p.a. |
AMP term deposit | 0.7% p.a. |
CUA term deposit | 0.65% p.a. |
Westpac term deposit | 0.25% p.a. |
Greater Bank term deposit | 1% p.a. |
The interest rates available on 5 year term deposits vary from one bank to the next. While there might not seem to be a huge difference in many of these interest rates, it’s definitely worth your while to find the highest interest rate you can. Take a look at the following fictional example:
As a make-believe example, let’s pretend 32-year-old tradie Steve wants to invest $10,000 in a 5 year term deposit. Let's say when he compares the accounts available from the two banks of which he is already a customer, Steve discovers a slight difference in the interest rates on offer – Bank A offers 2.75% p.a. while Bank B offers 3.25% p.a. Both accounts pay interest monthly, so Steve compares the accounts to see just how much difference a higher rate will make to his end balance.
Bank A | Bank B | |
---|---|---|
Interest rate | 2.75% p.a. | 3.25% p.a. |
Investment term | 5 years | 5 years |
Interest paid | Monthly | Monthly |
Balance after 5 years | $11,472.21 | $11,761.90 |
Total interest paid | $1,472.21 | $1,761.90 |
As you can see, even though the interest rate from Bank B is only 0.50% p.a. higher, this works out to be a difference of $289.69 at the end of the investment term.
Make sure to keep the following features in mind when comparing the benefits of 5 year term deposits:
A 5 year term deposit provides a safe and reliable long-term investment option. Compare 5 year term deposit accounts at finder.com.au and find the right account to help you save towards your financial goals.
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