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Term Deposit Comparison

Compare term deposit accounts that pay interest monthly

Need to manage your cash flow needs? Term deposit accounts that pay interest monthly could help.

Shirley Liu
Shirley Liu

With a term deposit account that pays interest monthly, you have the opportunity to manage your cash flows with an influx of interest every month. A term deposit account is a short to long term investment account that allows your money to grow by accumulating interest.

The interest is calculated daily allowing your account balance to grow faster. The length of time is predetermined by you when you make the initial deposit and can be anywhere from just a few months to as long as 10 plus years.

Term Deposit Offer

Judo Bank Term Deposit

2.00 % p.a.

fixed for 6 months

Term Deposit Offer

Earn a 0.10% p.a. loyalty bonus when you roll over your term.
The Judo Bank Term Deposit term lengths range from six months to five years. Minimum opening deposit is $1,000. No account-keeping or set-up fees to pay.

  • Minimum investment: $1,000.00
  • Monthly fees: $0.00
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*Rates are displayed for the terms and minimum deposit sizes listed in the table below. The rate you receive could vary depending on your deposit size and interest payment frequency. Please note that the rates displayed on this table are calculated based on interest being paid at maturity. Please click 'Go to site' to access the interest rates for other payment frequencies.

Rates last updated December 15th, 2019
$
Name Product 3 Mths p.a. 4 Mths p.a. 5 Mths p.a. 6 Mths p.a. 7 Mths p.a. 12 Mths p.a. 24 Mths p.a. Product Description Interest Earned
Judo Bank Term Deposit
Judo Bank Term Deposit
-
-
-
2.00%
-
2.00%
2.20%
Earn a 0.10% p.a. loyalty bonus when you roll over your term.
The Judo Bank Term Deposit term lengths range from six months to five years. Minimum opening deposit is $1,000. No account-keeping or set-up fees to pay.
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Citibank Term Deposit 250K
Citibank Term Deposit 250K
2.00%
-
-
1.80%
-
-
-
A short-term investment option with a guaranteed rate of return.
Suited to customers with deposits over $250,000.
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MyState Bank Online Term Deposit
MyState Bank Online Term Deposit
1.90%
-
-
1.70%
-
-
-
Single or joint account-holders can apply online with MyState's online application process.
The MyState Bank Online Term Deposit has a choice of term lengths. Interest is paid upon maturity of the term deposit.
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Once you deposit the money into your term deposit account, it cannot be withdrawn before the terms expire without being subjected to a high penalty charge. The account it will accumulate a fixed interest rate monthly until the account has matured. This can be a great incentive as it can encourage you to hold onto your savings until you really need it.

Did you know?

New rules and regulations have meant that you need to give 31 days notice before accessing your term deposit before it matures.

What do I need to look for when comparing term deposits?

  • The frequency that interest is paid. Make sure you confirm with the financial institution that interest can be paid on a monthly basis. This type of compound interest will allow your balance to grow faster. Other options will include annually and at maturity. Read the fine print before committing to anything.
  • Maturity terms. You will first want to decide how long you want the money to be held in this type of account. Some lenders will allow you to have very short terms of just a few months while others will encourage longer term savings of a few years. Be sure to find the bank that has the terms you need in order to avoid having to take your money out before they end.
  • Minimum deposit. When choosing between different term deposit accounts make sure that you are looking at the rates based on what your initial deposit will be. Some will give a better interest rate for higher deposit amounts.
  • Interest rate. The amount of interest you are going to earn will make a big difference in whether this is an effective investment tool for you. When comparing the different rates between banks make sure that you are being specific about your deposit amount, length of term and payment frequency. All of these factors could affect the amount of interest you earn monthly on your deposit.

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What are the pros and considerations?

Pros

  • Cash flow management. Having a guaranteed payment every month can help you budget, manage your finances or plan other investments.
  • Low risk. This type of account is secured by the Australian Government for amounts up to $250,000.
  • Fixed rate. With a fixed interest rate for the life of your term deposit you can easily project how much money will be earned by the time your terms come to an end.
  • No access. While some may see this as a negative point for a bank account, the penalties imposed for withdrawing your money too soon is a powerful incentive to save. This is especially true if the funds are earmarked to serve a specific purpose such as a new home deposit.

Considerations

  • Penalties. Even in the event of an emergency where you need even a partial amount of the money back, you will still be subjected to a penalty for early withdrawal. Each institution will charge the penalty in a different way, some by deducting a percentage of the interest while others charging a break cost. Only enter into this type of account if you are absolutely sure that you will not need to access the money before the terms end.

What are some of the risks to watch out for?

Besides the high penalty fees, there are a few options hidden within the features of a term deposit account that could hurt you if you are not aware of them beforehand. For instance, some banks will require that you also hold a transaction account or other deposit account in addition to your term deposit account. If there are high fees associated with their other accounts those will chip away at your real savings.

Another feature to avoid is the automatic renewal. In some cases, if you don’t make your intent known before the end of your term, the institution may automatically renew the term deposit account. Be clear with the bank before the term ends if your intent is to withdraw the balance.

Term deposits Q&A

Typically there are no fees with this type of account. The only charge you will have to concern yourself with is the penalty that will be charged if you make an early withdrawal.
In most cases yes, a statement will be generated that reflects the growth of your account, although the frequency will vary depending on the institution. Many also offer online access to help you keep track of your investment earnings.

You may also be interested in

Usually not, as this could change the interest rate for the deposit. If you anticipate that you will be adding to your deposit amount, than a high interest savings account may be your better choice. There are some banks that offer higher rates on an account where there is a monthly deposit made and no withdrawals. That may be worth considering if you need more flexibility with your savings.
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