Media Release

Savings could take $1.3 billion dive following rate cut

        • Two banks have already passed on cuts to savers
        • $526 billion kept in savings accounts across the country
        • Finder’s top high interest savings accounts

10 June, 2019, Sydney, Australia – New research from Finder, Australia's most visited comparison site, reveals that Australian households could lose over a billion dollars in interest on their savings, following the Reserve Bank's cash rate cut on Tuesday.

While mortgage holders are rejoicing at the passing of the first rate cut since August 2016 and a record low cash rate of 1.25%, it's a different story for those relying on savings, particularly retirees.

Australians currently have $526 billion kept in savings accounts across the country, according to Finder research.

If banks pass on the RBA's 25 basis point interest rate cut in full, Aussies will lose a staggering $1.3 billion in interest over the course of a year.

This week we've seen AMP cut its base rate on their savings account by 25 basis points. Suncorp reduced its savings account rates by up to 30 basis points while ING passed on a cut of 20-25 basis points to term deposits.

Graham Cooke, insights manager at Finder, says that it's crucial that savers start looking for the best deal on the market.

"With another cut or two on the horizon for 2019, it'll be interesting to see how many will hold this time around and pass it on next time.

"However, our research shows that the average online savings account rate has followed the cash rate when it has moved 99% of the time since 1990, so cuts of some degree are almost guaranteed.

"If more lenders pass on the cut, it's likely to hurt Aussies that have worked hard to put away a large amount of savings, such as those saving for their first home, or retirees relying on their savings as a form of income," says Cooke.

"It's crucial to check how your savings account stacks up. Even a marginally better rate could pocket you more money in the long run."

Changes to savings and deposit accounts

BankProductChangeNew rateEffective date
AMPAMP Saver Account25 basis points1.85%10 June
SuncorpSuncorp Growth Saver Account30 basis points (to bonus rate)2.30%10 June
SuncorpSuncorp Everyday Options Sub Accounts25 basis points1.15%10 June
SuncorpSuncorp eOptions Savings Account30 basis points1.10%10 June
INGING Personal Term Deposits (90 day)25 basis points1.50%7 June
INGING Personal Term Deposits (1 Year)20 basis points2.25%7 June
INGING Personal Term Deposits (2 Years)20 basis points2.25%7 June

To stay one step ahead of the game, it's important to compare different savings accounts from a range of reputable banks, building societies and credit unions, Cooke says.

"You could even consider hopping between savings accounts and taking advantage of their introductory rates.

"However, the best value in the market can be found in accounts with ongoing bonus interest rates. These tend to be savings products from online only banks that unlock a constant high rate if you also do your day-to-day banking with them.

"If you're opening up a new bonus savings account, make sure you check the account conditions for earning the bonus rate. Also make sure you check what the interest rate will revert to once the introductory honeymoon period ends."

Finder’s top high interest savings accounts*

ProductInterest rate and conditions
HSBC Serious Saver- Maximum Rate: 3.10% p.a. for 4 months - Standard Variable Rate: 1.20% p.a. - Maximum Rate only applicable when you make no withdraws - Monthly fees: $0.00
Citibank Online Saver- Maximum Rate: 2.90% p.a. for 4 months - Standard Variable Rate: 1.60% p.a. - Monthly fees: $0.00
UBank Saver- Maximum Rate: 2.87% p.a. - Standard Variable Rate: 1.81% p.a. - Monthly deposit required: $200.00 - Monthly fees: $0.00

*As of 07/06/2019, subject to rate changes

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Disclaimer

The information in this release is accurate as of the date published, but rates, fees and other product features may have changed. Please see updated product information on finder.com.au's review pages for the current correct values.

About us

Every month 2.2 million unique visitors turn to Finder to save money and time, and to make important life choices. We compare virtually everything from credit cards, phone plans, health insurance, travel deals and much more.

Our free service is 100% independently-owned by two Australians: Fred Schebesta and Frank Restuccia. Since launching in 2006, Finder has helped Aussies find what they need from 1,800+ brands across 100+ categories.

We continue to expand and launch around the globe, and now operate in the United States and the United Kingdom. For further information visit www.finder.com.au.

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