Are banks making it too difficult to save? The ACCC thinks so
Report calls out barriers to switching and strategic pricing making things too complex for saving Aussies.
Have you watched interest rates rise recently and wondered why your savings don't seem to be moving? Have you signed up to a 'high-interest savings account' only to find you're not getting the rate you thought you would? Have you tried to switch your savings account only to get frustrated and give up?
If so, you're not alone. A new report has been released by the ACCC which outlines the many barriers to saving that Australians are facing.
The Retail deposits inquiry final report found that customers were finding it too difficult to search for and switch between deposit products, like bank accounts.
It also called out banks' "strategic pricing", which includes things like introductory rate offers, bonus interest rates, as well as confusing fees and charges.
The ACCC said these created "complexity and makes it difficult for consumers to compare products". Sound familiar?
Many high-interest rate savings accounts also only provide those high interest rates for customers who meet certain criteria. So while you might think you're in for a savings rate of above 5%, you need to do things like deposit at least $1000 each month, grow your savings and make a certain number of transactions to qualify for that rate.
Although the ACCC has recommended that banks up their game and make it easier for customers searching for better rates, it's only a recommendation.
Luckily, Finder helps you easily compare savings accounts and all their features in one place. However, it can still seem overwhelming when there are so many accounts and features to consider.
If you're not sure how to compare, follow these steps to get started:
1. The interest rate.
Ideally, you should be looking at interest rates on savings accounts above 5% now, but be sure to check if it is an ongoing rate or if it's part of an introductory offer.
2. Conditions.
Some savings accounts require you to meet certain conditions before you can take advantage of high rates. It might say 5.50%, but if you don't meet the conditions it could revert to a much lower rate. Take a look at the conditions and think about whether they are manageable for you or not.
3. Account fees.
Most banks won't charge fees if you're actively using the account. It's safe to check though, and if you're looking at an account with a fee, you might want to look elsewhere.
4. Access to your money.
Some savings accounts may restrict the number of withdrawals you can make each month. If you want regular access to your money, be sure to check you can withdraw or move your money any time.
5. Transaction account.
Even if you're just looking for a savings account, you may find you need to set up a linked transaction account with the same bank. If you don't mind doing that, make sure to look at any conditions or fees that might come with that account.
If you want to boost your savings, compare high interest savings accounts now.