The advent of internet banking and online bank accounts has opened up a whole new world for people looking for a high interest savings account. Previously term deposits were the savings products of choice, but these days online banks are offering new savings products that give greater flexibility, high interest rates and low fees.
What Do the Best Online High Interest Savings Accounts Feature?
Online bank savings accounts offer a unique solution that allows the saver to access high interest rates whilst having access to their savings at the click of a mouse. Savings may be transferred into a linked account and accessed in an instant, giving the saver total flexibility. Online bank accounts are generally only accessible online or by phone.
Linked accounts usually have to be with the same bank as the online saving account, however in Australia ING Direct do not have this requirement.
New funds may also be deposited into the online savings account at any time, meaning the high saving rate can be applied to every spare dollar where as with traditional term deposits no additional funds may be added to the investment mid-term. This allows savings to grow and earn interest from day one.
Internet bank accounts also have few, if any fees associated with them. There is usually no minimum deposit, no monthly fees, and no transaction fees. However, the transaction account that is linked to the online high interest saving account may have fees that need to be considered.
What are the Interest Rates for the Best Internet Savings Accounts, Compared to Term Deposits?
Surprisingly, the bank interest for savings online is very competitive when compared to a term deposit. For example, Australian bank Bankwest have a 12 month introductory rate of 6.15% for their Telenet Saver, whereas their 12 month Term deposit is only offering 6.05%.
Hot Saving Tip - It is entirely possible, and highly recommended to close the account at the end of the introductory 12 months and have another shop around for the best saving account or product.
Current Rates on Australian Online Savings Accounts – as at 20/8/2010
Westpac Online Banking – Westpac are offering a 4 month introductory rate of 6% on their e-Saver account, which then reduces to 4.25% thereafter. Their current term deposit stands at 6% for 12 months.
ANZ Internet Banking – ANZ are offering 4.5% on their Online Saver, and currently have an interest rate of 6% for 5 months.
Bankwest Telenet Online Savings Account – Bankwest are currently offering 6.15% for 12 months on their Telenet Saver, with a 6.05% interest rate on their 12 month term deposit.
Commonwealth Bank Netbank Saver - CBA are offering an introductory rate of 6% until the 30th November which then reverts back to 4.5%. Their term deposit is offering 6% for 6 months.
NAB iSaver Online Savings Account – NAB is offering a 4 month intro rate of 6% which then reverts back to 4.25%. Their 7 month term deposit is offering 6%.
ING Direct Savings Maximiser Account – This online savings account is offering a huge 6.25% for 4 months which then reverts to 4.9% thereafter. ING’s term deposit is sitting at 6.5% for 12 months.
*Bonus* ING are currently offering bonus interest of $20 if an account is opened by 30/9/2010.
In light of this research, ING Direct has a very competitive product that offers the best flexibility as well as a superior interest rate. Bankwest also have a very competitive savings rate, with the longest introductory period available. Shop around to find the very best interest rate and maximise your savings!
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Jessica Peletier - Jessica Peletier is a woman of varied interests. She is private investor with experience trading shares, CFD's and options, as well as ...
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