Westpac slashes savings account rate again – should you switch?

Posted: 18 February 2022 3:15 pm
News
Young woman at home

As other banks look to raise their savings rates, is the Westpac Life savings account for under 30s still competitive?

The Westpac Life savings account for under 30s has boasted a market-leading bonus rate of up to 3.00% p.a. for more than a year. However, due to a second cut to the rate today, it's now down to 2.00% p.a.

This rate is still high for today's market. However it's got some restrictions attached. You need to be aged 18–29, and the bonus rate is only offered on balances under $30,000. You also need to grow your balance each month, make sure your balance stays above $0 and make 5 or more debit card purchases from your linked Westpac Choice transaction account each month.

Westpac dropping its rate (again) is bad news for young savers, particularly when many people expected the ultra-low savings rates to finally edge up a bit higher this year. So, how does Westpac's account compare now? If you're a customer, should you look to switch?

Is Westpac's savings account still competitive?

In today's low-rate environment, any savings rate above 1.00% p.a. is quite good.

Westpac's new 2.00% p.a. rate is still one of the highest in the market, but there are a few limitations to this account that make it difficult to earn this rate. If you're under 30 and have less than $30,000 in savings, it could be a great option for you. The BoQ Fast Track Starter account offers the same interest rate at 2.00% p.a., but you need to be under 24 and it's only paid on balances under $10,000.

But if you're over 30 (or getting close to it) or have a bigger balance, you will need to look elsewhere.

AMP recently increased the total bonus interest rate on its AMP Saver account from 1.16% p.a. to 1.35% p.a. To earn the bonus rate, you need to deposit at least $250 into an AMP Saver account in the previous month.

In line with the AMP Saver, the ING Savings Maximiser also offers a bonus rate of 1.35% p.a. when the conditions are met. To get the bonus rate with ING, you need to deposit at least $1,000 a month, make 5 or more card purchases and grow your Savings Maximiser balance (excluding interest earned).

The Virgin Money Boost account offers 1.20% p.a. when you deposit at least $2,000 each month (or $1,000 if you're under 25) and make at least 5 transactions from the account in the previous month.

Want to earn more interest on your money this year? Compare high interest savings accounts and switch to an account with a better rate.

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