Banking blind: 2 in 3 savers don’t know their interest rate
Aussies may be missing out on the chance to earn hundreds of dollars a year, according to new research by Finder.
A Finder survey of 1,085 respondents revealed two-thirds (64%) of Australians – equivalent to almost 13 million people – don't know the interest rate on their savings account.
The research found just 16% of Australians know their current interest rate – the average being 3.2%.
Alison Banney, money expert at Finder, said there's a huge opportunity for Australians to maximise their savings.
"It may have been a few years since you opened a savings account and things have changed dramatically in that time.
"It can be the difference of thousands of dollars a year in interest."
According to Finder's Consumer Sentiment Tracker, the average Australian has $38,290 in cash savings.
The average saver who deposits $681 per month could be earning $2,039 a year when banking with BoQ's Future Saver, which offers 4.75% p.a. for customers aged 14–35.
Savers who don't fall within this age bracket could also earn 4.55% with ING's Savings Maximiser.
Banney said loyalty doesn't pay when it comes to savings.
"Savings are becoming more valuable as interest rates are rising.
"It's often providers outside the Big Four that offer the best deals."
Finder's research shows almost 2 in 5 (36%) people – equivalent to over 7 million Aussies – hold a savings or transaction account across multiple banks.
More than 1 in 2 Aussies (53%) are still using a transaction account to store their savings – meaning they are getting 0% on their money.
Banney said a robust savings account is one of the best ways to cushion households in the current financial climate.
"If you're not getting a competitive rate, it's time to consider switching as savings rates continue to climb.
"With interest rates on the rise, your leading rate a few months ago might not be the best right now," Banney said.
| What interest rate are you currently earning on your highest savings account? | |
|---|---|
| I don't know | 64% |
| I do not have a savings account that earns interest | 20% |
| I know my interest rate | 16% |
| Source: Finder survey of 1,085 Australians, December 2022 |
| How many banks do you have a savings or transaction account with? | |
|---|---|
| 1 | 62% |
| 2 | 25% |
| 3 | 8% |
| 4 | 2% |
| I don't have a savings or transaction account | 2% |
| More than 5 | 1% |
| Source: Finder survey of 1,085 Australians, December 2022 |
| What accounts do you use for saving? | |
|---|---|
| Standard savings account | 55% |
| Transaction account | 53% |
| Bonus savings account (provides bonus interest based on set conditions) | 28% |
| Term deposit | 10% |
| Offset account linked to mortgage | 4% |
| Source: Finder survey of 1,085 Australians, December 2022 |
Saving account rates are going up significantly. Here are some of the best savings accounts for February 2023.