Notice Savers: A hybrid product between a savings account and term deposit

A notice saver offers interest on your money, however you need to give a certain amount of notice if you decide you want to withdraw your money.

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Notice savers allow you to earn interest on your savings in a similar way to term deposits, but rather than keeping your money "locked away" for a specified term, notice savers let you pick how much notice to provide a bank before they release your funds. Although not as easily accessible as what you get with an at-call savings account, you do get more flexibility than with a term deposit.

Compare notice savers below

Name Product Maximum Variable Rate p.a. Standard Variable Rate p.a. Intro Period Government Guarantee
AMP Notice Account
0.55%
0.55%
Ongoing
Rabobank Notice Saver (31 days)
0.55%
0.55%
Ongoing
Rabobank Notice Saver SMSF (31 days)
0.45%
0.45%
Ongoing
Rabobank Notice Saver (60 days)
0.6%
0.6%
Ongoing
Rabobank Notice Saver SMSF (60 days)
0.6%
0.6%
Ongoing
Rabobank Notice Saver SMSF (90 days)
0.7%
0.7%
Ongoing
BOQ Specialist Bank 32 Day Notice Account
BOQ Specialist Bank 32 Day Notice Account
0.6%
0.6%
Ongoing
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Compare up to 4 providers

How does a notice saver work?

Notice savers for personal use are offered at three different tiers: 31 day, 60 day and 90 day. The rate of return also increases as you increase the terms. If you want to access your savings after the account has been activated, you give the bank notice and they will release the money in the time frame that you choose.

In other words, if you sign on for a 60-day notice saver, you will need to tell the bank 60 days in advance of day you want access to your funds. If you occasionally dip into your savings, this could be of benefit to you. Although not instant, it allows access to your funds when you want yet still allows you to earn interest on your savings.

How do I compare notice savers?

Notice savers have unique features that could make them an appealing option for those who want to reach a savings goal, and need an extra incentive to get there. When comparing them, consider the following:

A notification term that suits you

You do have to choose how long of a notification you want to give when you open the account, which will require some thought as to your future needs. The lowest rates are paid on 31 day notices, and get progressively higher as you move to 90 days.

Competitive interest rate

The interest rate will have a direct impact on the return on your investment. If your main objective is to increase your savings rapidly you will want to choose the longer notice periods with the higher rates.

The ability to constantly add to your balance

Unlike term deposits, notice savers lock you out from withdrawals but not on deposits. That means you can continue to add to the principal amount to increase your savings.
Interest calculation

You get the most benefit in a savings product that calculates the interest daily and makes a monthly deposit. This allows you to benefit further with compound interest, where your earnings come from the combined total of your principal and earned interest amount.

Low minimum deposit requirements

You will want to check to ensure that you are able to meet any minimum deposit requirement for a notice saver account.

It can be linked with your regular bank account

As with most high interest savings account, you will need a transaction account to be linked to your notice saver. Check to make sure that your current bank will allow you to link your everyday account with a notice saver offered by another institution.

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What are the pros and cons of opening a notice saver account?

Pros

  • Interest rates. You may get the benefit of higher interest rates with a notice saver than you would with a standard savings account.
  • Continue saving. You have the option of continuing to add funds to this savings account. In some cases you can even set up regular payments from your transaction account into your notice saver.
  • More flexibility. You have the ability to make investment decisions on shorter notice than you would if the money was inside of a term deposit.

Cons

  • Notification time. Even though you are not locked in as with a term deposit, notice savers are still not ideal if you need your savings fast to cover the cost of an emergency.
  • Variable interest rates. A fixed interest rate guarantees the growth of your money at a steady rate, while with a variable rate you could potentially lose some of the interest earnings if there is a drop in the market.

Considerations before opening an account

As with any type of savings product, you must carefully weigh what your goals and needs are before making a final choice. This will help you to avoid:

  • Missing out on higher rates. If your goal is a couple of years into the future, a term deposit will give you a better rate of return for your investment than a notice saver.
  • Not meeting an emergency. This type of account still requires a waiting period before you can access the money. If you do not have other means to cover an emergency, you may want to consider splitting your savings and keeping some in an on call account just in case.

Have more questions about notice savers?

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