A 12 month term deposit locks your money away for one year, and offers you a competitive fixed interest rate on your balance. It's a great way to help you reach medium to long term savings goals; because the interest rate is fixed you can easily calculate how much your investment will earn over the life of the term. You can't access your money until the term expires, so you won't be able to waste it on impulse purchases.
Learn how 12 month term deposits work in this guide, and compare current 12 month term deposit rates in Australia.
Term Deposit Offer
Bank of Sydney Term Deposit Online Exclusive
fixed for 12 months
Term Deposit Offer
$0 monthly account keeping fees. The Online Exclusive Term Deposit by Bank of Sydney offers term lengths from 1 month to 13 months. Withdraw funds before maturity without notice (fees apply).
Are you over 55 years old and looking for a flexible 12 month term deposit?
If you're over 55 years old and are looking for a flexible term deposit option, the Suncorp 55 Plus Account might be a good option to consider. This account offers the flexibility of an everyday transaction account, with the option to lock away only a portion of your balance and earn a higher fixed interest rate up to 1.60% p.a. You can still access the rest of your money in the account for day-to-day spending. Take a look at the Suncorp 55 Plus account here.
What is a term deposit?
A term deposit is a type of savings account where you deposit a certain amount of money for an agreed period of time and earn a fixed rate of interest. You can choose how long you want to lock your money away, from as little as one month to five years. The fixed interest rate will be determined by the financial provider or bank, and the rates will vary between providers. Term deposits are different from a savings account because you can't access the funds. If you do need to access the money before the term ends (known as maturity), you'll need to give at least 31 days' notice and will likely need to pay a penalty.
Which 12 month term deposit is best?
There is no term deposit that is best, and what is best for you might not be best for someone else. The right term deposit for you will have a competitive interest rate and be a length that suits you. If you don't want to commit to a 12 month term, consider a 6-month term deposit or even a 3-month term deposit instead.
Use our term deposit calculator
Use our term deposit calculator to find out how much interest you could earn over 12 months.
Deposit amount: enter your deposit amount.
Interest: enter the interest rate offered on your 12 month term deposit (for example 3.00%).
Saving term: enter the number of months (12) your investment will be held.
*Whilst every effort has been made to ensure the accuracy of this calculator, the results should only be used as an indication. They are neither a recommendation nor an eligibility test for any product and should not be construed as financial advice, investment advice or any other sort of advice.
How do I earn interest with a term deposit?
A term deposit gives you a fixed interest rate in return for investing your money for a fixed amount of time. For example, if you opt for a 12 month term deposit you will lock away your funds for one year and you can't withdraw the money. In return, your bank awards you a competitive interest rate that's traditionally higher than a savings account.
You can elect to receive interest payments monthly or all at once after your term deposit reaches maturity. You can often elect which Australian bank account you'd like to receive your interest payments into. Remember, if you do need to make an early withdrawal, you will be charged fees and lose some of the interest you have earned.
How do I find the best 12 month term deposit for me?
Here's a number of factors to consider when you compare term deposit accounts:
The fixed interest rate
Your interest rate represents the return you'll get for investing your funds. The amount of interest applied to your term deposit will differ between various banks. In some instances the difference is substantial, making this an important feature to consider. Use our term deposit calculator above to see how much of a difference various rates could make to your investment.
Interest payment frequency
With a 12 month term deposit you could choose to have interest earned paid to you monthly, semi-annually or when the account matures.
Few or no fees
You shouldn't be charged any establishment or monthly account-keeping fees on a 12 month term deposit. With the exception of the penalty charge for an early withdrawal, there shouldn't be any other fees applied.
Minimum balance requirement
Term deposits have balance requirements that differ depending on the financial institution. Some only cater to higher deposits of $5,000 or more, while other banks allow for an account with a minimum balance of just $1,000.
What are the advantages and disadvantages of a 12 month term deposit?
You're not charged a monthly fee. There are no monthly deductions from your savings to cover the cost of maintaining the account. This means your money works harder for you.
It encourages you to save. You have an extra incentive to keep your savings inside the account by facing penalties for an early withdrawal. It's kind of like forced savings.
You could get a competitive interest rate. A 12 month term deposit provides you with a competitive interest rate to help build your savings faster. However, remember to compare your options before you commit to any product.
You can't access the term deposit until it matures. If you needed to withdraw your savings in order to cover an emergency expense, you'll need to give 31 days' notice (though flexibility applies for financial hardship). For this reason as well as the penalty, it is important to carefully decide how much you can afford to have tied up in a term deposit for 12 months.
Yes, term deposits are considered a low-risk investment. Personal deposits of up to $250,000 are protected under the Government Guarantee per person, per institution.
What happens to my 12 month term deposit when it reaches maturity?
If you don’t let the bank know of your intent to have the funds released at maturity, it could automatically start it in a new 12 month term deposit account, potentially at a lower interest rate. To avoid this, you must contact the financial institution before the account matures and let them know that you will be withdrawing the money.
Wait, I still have some questions about term deposits
Will I be able to choose when the interest is paid into my account with a 12 month term deposit?
In most cases, yes – with the longer term deposits you are able to choose between monthly, biannual or annual interest payments.
Are there online 12 month term deposits or do I have to visit a branch to set one up?
A large number of financial institutions which operate solely online do offer online term deposits, as do your traditional banks.
Can I have the interest payments made into another account?
Some banks do allow you to have the interest paid into your transaction account with another bank.
Shirley Liu is Finder's global program manager. She was previously the publisher for banking and investments and has also written comparisons for energy, money transfers, Uber Eats and many other topics. Shirley has a Master of Commerce and a Bachelor of Media, Journalism and Communications from the University of New South Wales. She is passionate about helping people find the best deal for their needs.
How likely would you be to recommend finder to a friend or colleague?
Very UnlikelyExtremely Likely
Thank you for your feedback.
Our goal is to create the best possible product, and your thoughts, ideas and suggestions play a major role in helping us identify opportunities to improve.
Important information about this website
finder.com.au is one of Australia's leading comparison websites. We compare from a wide set of major banks, insurers and product issuers.
finder.com.au has access to track details from the product issuers listed on our sites. Although we provide information on the products offered by a wide range of issuers, we don't cover every available product. You should consider whether the products featured on our site are appropriate for your needs and seek independent advice if you have any questions.
Products marked as 'Promoted' or "Advertisement" are prominently displayed either as a result of a commercial advertising arrangement or to highlight a particular product, provider or feature. Finder may receive remuneration from the Provider if you click on the related link, purchase or enquire about the product. Finder's decision to show a 'promoted' product is neither a recommendation that the product is appropriate for you nor an indication that the product is the best in its category. We encourage you to use the tools and information we provide to compare your options and find the best option for you.
The identification of a group of products, as 'Top' or 'Best' is a reflection of user preferences based on current website data. On a regular basis, analytics drive the creation of a list of popular products. Where these products are grouped, they appear in no particular order.
Where our site links to particular products or displays 'Go to site' buttons, we may receive a commission, referral fee or payment.
We try to take an open and transparent approach and provide a broad based comparison service. However, you should be aware that while we are an independently owned service, our comparison service does not include all providers or all products available in the market.
Some product issuers may provide products or offer services through multiple brands, associated companies or different labelling arrangements. This can make it difficult for consumers to compare alternatives or identify the companies behind the products. However, we aim to provide information to enable consumers to understand these issues.
Providing or obtaining an estimated insurance quote through us does not guarantee you can get the insurance. Acceptance by insurance companies is based on things like occupation, health and lifestyle. By providing you with the ability to apply for a credit card or loan we are not guaranteeing that your application will be approved. Your application for credit products is subject to the Provider's terms and conditions as well as their application and lending criteria.