When comparing savings accounts you will notice that with some, interest rates are tiered in accordance with the account balance. Most savings accounts apply the top bonus interest rate on balances under $250,000, and once you hit this balance size the interest rate drops dramatically.
When you are shopping for a place to park a significant amount of savings, there are a few things worth considering.
The government guarantee
The Australian government guarantees deposits of up to $250,000 in Australian banks. This means if you had a balance larger than this, the portion over $250,000 wouldn't be protected in the (unlikely) event the bank went under. You could consider splitting your balance up between more than one bank, to ensure all your money is protected by this bank guarantee scheme.
If you're looking for a safe place where you can set-and-forget your large balance, you might not like a savings account that has monthly account conditions. Look for one that doesn't require you to jump through too many hoops or, consider a term deposit instead as these have no monthly conditions to meet.
If you're happy to meet some account conditions each month in order to get the highest bonus interest rate, you might find that you'll get a higher rate on a lower balance. Consider what the rate would be if you split your $250,000+ balance up between two different savings accounts, to take advantage of the higher rates.
Picture: Shutterstock
The Australian Unity Freedom Saver account lets you earn a competitive rate on balances between $50,000 and $250,000. Learn more about this high interest savings account.
The Australian Unity Freedom Saver account lets you earn a competitive rate on balances between $250,001 and $500,000. Learn more about this high interest savings account.
Earn an ongoing bonus rate when you deposit $100 a month and make no withdrawals.
The Bankwest Easy Saver account offers a bonus rate for the first 4 months, then an ongoing standard variable rate with no conditions to meet.
Check out out review of the Bank of Queensland Simple Saver Account.
The Great Southern Bank Goal Saver Account has an ongoing bonus rate on balances up to $50,000 for customers aged 18-24.
Earn 2.30% p.a. on your savings each month you make at least one deposit and make no more than one withdrawal.
The Virgin Money Boost savings account (for 18-24 year olds) offers bonus interest each month you deposit money and meet the purchase requirements. Here's how the account works and how to apply.
The Virgin Money Boost savings account (for 25+ year olds) offers bonus interest each month you deposit money and meet the purchase requirements. Here's how the account works and how to apply.
Available to SMSFs, the Rabobank Notice Saver offers a high interest rate on your savings, but you’ll need to give at least one-month’s notice before you can withdraw your funds.