The best savings accounts make budgeting feel like fun (ish)

Which are the best savings accounts in December 2024?

To get this list of best savings accounts we are looking at the total bonus rate only. Each month, we pick the 4 accounts in our database with the highest total interest rate, regardless of the account conditions.

What to look for when you compare savings accounts

High interest rate

The higher the interest rate, the more interest you'll earn and the more your balance will grow. This is the most important feature to consider when choosing your account.

No fees

Savings accounts shouldn't charge you any fees. If you're getting charged a fee, know that this is not common and there are plenty of fee-free accounts.

Conditions you can meet

Savings accounts typically have monthly deposit requirements or spend conditions in order to earn the high bonus rate. Make sure you can meet these.

How to find the best savings account

The best savings account for you will depend on your age, financial situation, savings goals and spending habits. Here are a few different hypothetical examples of how you might pick a savings account based on your personal savings style.

You earn a regular income and are able to meet a monthly deposit condition

The best savings account for you will likely be one with the following:

• An ongoing bonus interest rate: Because you earn a regular income and are confident in your ability to save, a savings account with an ongoing, high bonus rate would offer the best rate for you.
• A monthly deposit condition: Usually the accounts with the best bonus rates have a monthly deposit condition, often $1000 per month, which is ideal for people with good savings habits and a regular income.

You have a short-term savings goal

Let's say you want to give your savings a boost for 3-5 months only to help you save for an overseas holiday or another large purchase. Because you're saving for a specific goal in the near future, you aren't planning to keep your cash in the account for too long and you don't want to have to meet any ongoing monthly conditions.

The best savings account for you will likely be one with the following:

• An introductory bonus interest rate: Accounts with an introductory bonus rate offer a higher rate for the first 3-5 months only, with no conditions to meet.
• A term deposit: A term deposit allows you to lock your money away for a set period of time and earn a fixed return, with no monthly conditions to meet.

Can't commit to a monthly deposit condition

Let's say you don't earn a regular income, or you're currently not in a position to meet a monthly deposit condition. Plus, perhaps you're also prone to dipping into your savings from time to time for impulse purchases or unexpected expenses.

The best savings account for you will likely be one with the following:

• An ongoing bonus interest rate: An account with an ongoing bonus interest rate will give your balance the best chance at growing (just make sure you check the conditions!)
• No (or low) monthly deposit condition: Look for a bonus saver account that doesn't have a monthly deposit condition. Or, look for one that you can comfortably meet (some accounts only ask you to deposit $20 per month).

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More ways to earn interest and save

Did you know you can earn more than 4% p.a. with a term deposit? Here are a few accounts offering above 4% p.a. when you lock your savings for a fixed term length.

Why keep your cash in a savings account?

• Savings accounts are safe - your deposit up to $250k is protected by the Australian government
• Savings accounts offer compound interest, so you can earn interest on your interest
• The money in your savings account is quick and easy to access if you ever need it
• Interest rates on savings accounts are going up!

The role of a savings account

Our expert says

"Although shares historically offer better long-term returns, people often ask why keep cash in a savings account. The answer is simple: a savings account offers certainty, security, and acts as a financial safety net. Unlike volatile shares, you won't lose money, and you can quickly access your cash when needed."

Alison Banney

Author

How does a savings account work?

Usually savings accounts are connected to transaction accounts and instead of the money sitting in your bank account, you can transfer it to your savings account and it'll earn interest (if you meet the account conditions, of course). The special thing about savings account interest is it's compound interest, meaning you'll earn interest on your interest.

Is it best to stick with the Big Four or go with a smaller bank?

Wondering which bank is best to open up your savings account with? Chances are you may be thinking of joining the Big Four. We've put together this pros and cons list of the Big Four VS smaller banks to help you make a decision easier.

How do I open an Australian savings account?

In most cases you can apply and open the savings account online, as long as you're able to provide documentation that confirms your identity and residency. If you're a new customer to the bank, you'll need to verify your identity for legal reasons. For the online savings and bonus saver accounts, some banks will allow an Australian as young as 12 years old to have an account opened in their name.

Find the right savings account

FAQs on best savings accounts

• Will saving rates go up in 2023?

  Based on the goal of the RBA to manage inflation and spending, we predict the RBA will continue to increase the official cash rate in 2023. This means that savings rates will likely continue to increase too, along with mortgage rates.

• Are introductory rates worth it?

  Introductory savings rates are often among the highest in the market, but they're only available for a short period of time. If you have a short term savings goal, or you're willing to move your money around every 4-6 months, then a high introductory savings rate could be worth considering.

• Is ING Savings Maximiser the best savings account?

  ING's savings account has been very popular ever since finance expert Scott Pape recommended it in his book The Barefoot Investor. At the time when the book was first written in 2016, ING's savings rate was the best in market. ING Savings Maximiser's rate today is 5.5% which remains one of the highest in market. However, ING's account does come with several conditions to earn that rate, which could be difficult to meet for some customers. In comparison, some other accounts with similar rates have very minimal conditions to meet. It also only pays bonus interest on balances up to $100,000, while many other accounts pay interest on larger balances up to $250,000.

• Should I declare the interest earned on my tax return?

  Any interest earned on your savings account is treated as income and should be declared when lodging your tax return. This will often already be pre-filled for you, as the ATO usually already has access to your annual bank statements.

• What is a good interest rate for a savings account?

  Currently, any savings rates above 4% are quite good (there are even a few rates above 5% now). Remember - a good savings rate is one that you can easily earn by meeting the account conditions. There's no point opting for the highest rate in the market if you can't meet the account conditions.

Written by

Alison Banney

Editor

Alison Banney is the money editorial manager at Finder. She covers all areas of personal finance, and her areas of expertise are superannuation, banking and saving. She has written about finance for 10 years, having previously worked at Westpac and written for several other major banks and super funds. See full bio

Alison's expertise

Alison has written 625 Finder guides across topics including:

• Superannuation
• Savings accounts, bank accounts and term deposits
• Budgeting and money-saving hacks
• Managing the cost of living