Compound interest and your savings account

Compare compound interest savings accounts

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Finder Score	Maximum interest rate	Base interest rate	Max rate type & duration	Monthly max rate conditions
Promoted Finder score 9.5 Excellent AMP Bank GO Save	Finder score 9.5 Excellent	Maximum Variable Rate p.a. 4.25%	Standard Variable Rate p.a. 4.25%	Intro/Ongoing Ongoing rate (conditions apply)	Balance $0 to $250,000	Go to siteMore info Compare product selection Compare	loading
Promoted Finder score 9.1 Excellent Rabobank High Interest Savings Account	Finder score 9.1 Excellent	Maximum Variable Rate p.a. 5.00%	Standard Variable Rate p.a. 3.45%	Intro/Ongoing 4 month intro rate	Balance $0 to $250,000	Earn a high interest rate of 5.00% p.a. for the first 4 months and then 3.45% p.a. thereafter, with $0 account keeping fees and no monthly balance requirements.	Go to siteMore info Compare product selection Compare	loading
Promoted Finder score 9.5 Excellent Bankwest Easy Saver	Finder score 9.5 Excellent	Maximum Variable Rate p.a. 4.80%	Standard Variable Rate p.a. 4.00%	Intro/Ongoing 4 month intro rate	Balance $0 to $250,000	Go to siteMore info Compare product selection Compare	loading
Finder score 9.5 Excellent ING Savings Accelerator Most Loved	Finder score 9.5 Excellent	Maximum Variable Rate p.a. 5.00%	Standard Variable Rate p.a. 3.95%	Intro/Ongoing 4 month intro rate	Welcome rate applies to balances $150,000 - $500,000 Ongoing rate applies to balances $150,000 - $5 million	Ideal for higher balances, savers can earn up to 5% for the first 4 months and up to 3.95% thereafter. There are no conditions and $0 account-keeping fees.	Go to siteMore info Compare product selection Compare	loading
Finder score 9.1 Excellent ING Savings Maximiser Most Loved	Finder score 9.1 Excellent	Maximum Variable Rate p.a. 4.75%	Standard Variable Rate p.a. 0.01%	Intro/Ongoing Ongoing rate (conditions apply)	Deposit $1,000 5 transactions Grow your balance Balances up to $100,000	Welcome bonus: Get $100 when you open a new Orange Everyday and Savings Maximiser account with code OE100JOIN and deposit $1000, plus make 5 debit purchases by 31 January 2026. T&Cs apply.	Go to siteMore info Compare product selection Compare	loading
Finder score 8.7 Great Suncorp Bank Growth Saver Account	Finder score 8.7 Great	Maximum Variable Rate p.a. 4.30%	Standard Variable Rate p.a. 0.05%	Intro/Ongoing Ongoing rate (conditions apply)	Grow balance by $200 each month (excl. interest) Only 1 withdrawal No balance limit on earning interest	Get a solid interest rate on your entire balance, with minimal conditions in order to get the max rate. This account doesn’t offer card access but you can make 1 withdrawal per month & grow your net balance by $200 (excl. interest) to earn the max rate.	Go to siteMore info Compare product selection Compare	loading
Finder score 9.7 Excellent Macquarie Savings Account	Finder score 9.7 Excellent	Maximum Variable Rate p.a. 4.60%	Standard Variable Rate p.a. 4.25%	Intro/Ongoing 4 month intro rate	Balance $0 to $250,000	Earn a welcome variable rate of 4.6% p.a. for the first 4 months on balances up to $250k, then 4.25% p.a. ongoing variable rate on balances up to $2m. There are no monthly requirements to earn interest.	ContinueMore info Compare product selection Compare	loading
Finder score 8.7 Great IMB Reward Saver Kick Start	Finder score 8.7 Great	Maximum Variable Rate p.a. 4.75%	Standard Variable Rate p.a. 0.00%	Intro/Ongoing Ongoing rate (conditions apply)	Balances $0 to $100,000 Deposit $20+ each month No withdrawals	You can open this account if you are aged 13 to 17, or if you're a student, trainee or apprentice aged 18 to 30.	Go to siteMore info Compare product selection Compare	loading
Finder score 9.1 Excellent Ubank Save Account Finder Award	Finder score 9.1 Excellent	Maximum Variable Rate p.a. 5.10%	Standard Variable Rate p.a. 0.00%	Intro/Ongoing 4 month intro rate	Balance $0 to $1,000,000 Have a Spend account Grow balance by $1 or more (excl. interest)	5.1% p.a. welcome bonus rate for new customers for the first 4 months, then an ongoing bonus rate of 4.35% p.a. when you hold a Ubank Spend accout and grow your Save balance by at least $1 (excluding interest) each month.	Go to siteMore info Compare product selection Compare	loading
Finder score 8.2 Great Newcastle Permanent Smart Saver Account	Finder score 8.2 Great	Maximum Variable Rate p.a. 3.75%	Standard Variable Rate p.a. 0.05%	Intro/Ongoing Ongoing rate (conditions apply)	Grow balance No more than 2 withdrawals	Go to siteMore info Compare product selection Compare	loading
Finder score 8.6 Great Regional Australia Bank Savings Booster Account	Finder score 8.6 Great	Maximum Variable Rate p.a. 4.25%	Standard Variable Rate p.a. 0.00%	Intro/Ongoing Ongoing rate (conditions apply)	Balance up to $250,000 Deposit $100 each month No withdrawals	Go to siteMore info Compare product selection Compare	loading
Finder score 9.5 Excellent BCU Bank Power Saver	Finder score 9.5 Excellent	Maximum Variable Rate p.a. 4.35%	Standard Variable Rate p.a. 0.50%	Intro/Ongoing Ongoing rate (conditions apply)	Deposit $100 Balances up to $250,000	Go to siteMore info Compare product selection Compare	loading
Finder score 8.6 Great First Option Bank Savings+Bonus Account	Finder score 8.6 Great	Maximum Variable Rate p.a. 4.25%	Standard Variable Rate p.a. 1.75%	Intro/Ongoing Ongoing rate (conditions apply)	Balance $1 to $249,999 Deposit $100 No withdrawals	ContinueMore info Compare product selection Compare	loading
Finder score 7.8 Great IMB Reward Saver Account	Finder score 7.8 Great	Maximum Variable Rate p.a. 4.50%	Standard Variable Rate p.a. 0.00%	Intro/Ongoing 4 month intro rate	Balance $0 to $1,000,000 Deposit $50 No withdrawals	Earn up to 2.5% p.a. after the introductory period ends.	ContinueMore info Compare product selection Compare	loading
Finder score 9.2 Excellent BCU Bank Boss Saver	Finder score 9.2 Excellent	Maximum Variable Rate p.a. 4.65%	Standard Variable Rate p.a. 0.20%	Intro/Ongoing Ongoing rate (conditions apply)	Balance $0 to $100,000 Deposit $500 5 Access Account debit card purchases	Earn an ongoing 4.65% p.a. when you deposit $500 per month and make 5+ card payments from your BCU Bank Access Account each month. You can make withdrawals and still earn bonus interest.	Go to siteMore info Compare product selection Compare	loading
Finder score 8.9 Great P&N Bank Savvy Saver	Finder score 8.9 Great	Maximum Variable Rate p.a. 4.65%	Standard Variable Rate p.a. 0.20%	Intro/Ongoing Ongoing rate (conditions apply)	Balance under $100,000 Deposit $500 5 Access Account debit card purchases	Get 4.65% p.a. ongoing when you deposit $500 and make 5 debit card purchases per month. Make withdrawals and still earn bonus interest.	Go to siteMore info Compare product selection Compare	loading
Finder score 7.2 Great BCU Bank Bonus Saver	Finder score 7.2 Great	Maximum Variable Rate p.a. 4.25%	Standard Variable Rate p.a. 0.05%	Intro/Ongoing 4 month intro rate		Go to siteMore info Compare product selection Compare	loading
Finder score 8.7 Great Westpac Life (18-34 year olds only)	Finder score 8.7 Great	Maximum Variable Rate p.a. 5.00%	Standard Variable Rate p.a. 0.10%	Intro/Ongoing Ongoing rate (conditions apply)	Make a deposit Grow your balance 20 debit card purchases Balances up to $30,000	Go to siteMore info Compare product selection Compare	loading
Finder score 7.2 Great P&N Bank Hi Saver Account	Finder score 7.2 Great	Maximum Variable Rate p.a. 4.25%	Standard Variable Rate p.a. 0.05%	Intro/Ongoing 4 month intro rate		Go to siteMore info Compare product selection Compare	loading
Finder score 9 Excellent St.George Incentive Saver	Finder score 9 Excellent	Maximum Variable Rate p.a. 4.40%	Standard Variable Rate p.a. 0.10%	Intro/Ongoing Ongoing rate (conditions apply)	Balance up to $249,999.99 Grow balance by at least $50 ($0.01 if under 21)	Go to siteMore info Compare product selection Compare	loading
Finder score 8.7 Great First Option Bank Kids Bonus Saver	Finder score 8.7 Great	Maximum Variable Rate p.a. 4.80%	Standard Variable Rate p.a. 0.05%	Intro/Ongoing Ongoing rate (conditions apply)	Balance $1 to $5,555 Aged under 18 Deposit $5 each month No withdrawals	ContinueMore info Compare product selection Compare	loading
Finder score 9.4 Excellent Bank of Queensland Simple Saver Account	Finder score 9.4 Excellent	Maximum Variable Rate p.a. 4.05%	Standard Variable Rate p.a. 4.05%	Intro/Ongoing Ongoing rate (conditions apply)	Balance $0 to $5,000,000	Open up to 9 accounts to take control of your savings and don't worry about meeting fiddly conditions or paying frustrating fees.	ContinueMore info Compare product selection Compare	loading

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How we picked these

How the Finder Score helps you find a better savings account

The Finder Score is a simple score out of 10. The higher a savings account's score, the better we think it is for the average customer.

We score each savings account in our database of hundreds based on a data-driven methodology with 2 main criteria: Does the account offer a high interest rate? And is it easy for savers to actually earn that rate?

Read the full breakdown

Our expert says

"Compounding is like a magic trick that makes your money grow faster, or your debt grow bigger. Either way, it means that small, consistent efforts – even as little as paying $20 extra into your mortgage, super or savings each week – can make a big impact down the track."

Sarah Megginson

Personal finance expert + media spokesperson

How does compound interest work?

The best way to explain how compound interest works is with an example using Finder's compound interest calculator:

• Let's say you invest $20,000 in an account with an interest rate of 5.50% p.a. compounded for 5 years.
• The initial investment of $20,000 earns $1,128.16 in the first year, giving you a total of $21,128.16.
• The following year, you still earn the same rate of 5.50% p.a. – but this time it's applied to $21,128.16.
• This will make your balance $22,319.95 after the second year, even though you haven't deposited any extra money into the account yourself.
• This amount ($22,319.95) is the base for compounding for the third year, and so on. After 5 years, you'll have $26,314.08.

The longer your timeline ahead of you, the more your balance grows. In our fictional example, after 10 years, you'd have $34,621.53 and after 20 years, $59,932.51. This is without ever adding an extra cent of your own money.

To get the most benefit out of compound interest, deposit as much as you can into your account and restrict the number of withdrawals you make. The more money that is in your account at the end of the month, the more interest you will earn.

How can compound interest help you grow your savings?

Compound interest can turn a small amount of money today into a large amount of money over the space of 10, 20 or 30 years.

The longer your timeline ahead of you, the more you stand to benefit from compound interest.

How do banks calculate compound interest?

Interest is typically calculated on the daily closing balance. Here's the savings account equation:

• Daily closing balance x interest rate (as a percentage) / 365

Interest begins to accumulate on the day the opening deposit is made in your savings account. It's then usually credited into your account on the last day of each month. If you choose to close your account, your accrued interest will be deposited on the day it's closed.

Any interest awarded to your savings account is usually available for use on the same day it's been credited. The daily closing balance of your savings account tends to include all cleared and uncleared transactions. This may be because electronic transfers to your linked bank account usually occur on a business day.

Our expert says

"I would almost always put money into a savings account over a term deposit. Savings accounts earn compound interest (meaning you earn interest on the interest paid), whereas most term deposits only earn simple interest (meaning you earn interest only on the initial deposit)."

Alanna Glenn

Money Expert

How do you find the monthly interest rate?

The monthly variable interest rate will be clearly displayed on the provider's website under the product description for the particular account you’re looking at. Instead of going to each bank's website, you can take a look at the latest high interest savings account interest rates in our guide. It is important to remember that the interest rate is variable, meaning it will change from time to time.

Frequently asked questions

• How can I tell if a savings account pays compound interest?

  Savings accounts in Australia pay compound interest. But to help you compare between types of products, you will want to first look at when interest is paid, and then where. Interest that is paid monthly into the savings account will be compounded.
  However, on some term deposits for example, you can choose to have monthly interest payments, but these are paid into your linked account, not added to your balance, meaning you earn simple interest.

• If my savings account requires a minimum monthly deposit, will my earned interest count towards that?

  In most instances no, the minimum monthly deposit requirement must be met with other money deposited in the account. For instance, if the account requires a deposit of $150 and you have a balance of $100,000, the interest deposited for the month will be $166.66. This usually will not count towards your minimum deposit, and you'll need to transfer money in from another external account to meet this requirement.

• Will my interest earnings be taxed?

  Yes, banks are required to withhold tax on your interest earnings. The amount depends on your personal circumstance. To avoid having tax withheld at the highest marginal rate, you should always include your tax file number (TFN) and exemption codes on your application.

• How can I make the most out of the interest on my savings account?

  To help grow your savings, regularly deposit money into the account and allow time for your savings to grow. The longer your money is in the savings account, the more money you'll earn.

• How else can I earn compound interest?

  Compounding can be found with a number of different financial products. One example is investments, including via your superannuation. Instead of earning interest, you earn compounded investment returns. This is why investing a small amount early on in life is so beneficial - it can grow to a lot more over time through the power of compounding.

To make sure you get accurate and helpful information, this guide has been edited by Moira Daniels and reviewed by Karen Eley, a member of Finder's Editorial Review Board.

Written by

Alison Banney

Editorial Manager, Money

Alison is an editor at Finder and a personal finance journalist with over 10 years of experience, having contributed to major financial institutions and publications such as Westpac, Money Magazine, and Yahoo Finance. She is frequently quoted in media outlets like SmartCompany and SBS, offering expert insights on superannuation and money management. Alison holds a Bachelor of Communications in Public Relations and Journalism from the University of Newcastle, and has earned three ASIC RG146 certifications in superannuation, securities and managed investments and general financial advice, ensuring her expertise is fully aligned with ASIC standards. See full bio

Alison's expertise

Alison has written 660 Finder guides across topics including:

• Superannuation
• Savings accounts, bank accounts and term deposits
• Budgeting and money-saving hacks
• Managing the cost of living