Best savings choices

When it comes to investing your money you have plenty of options to choose from. Deciding on the right option will come down to your personal situation but there are two savings options that most Australians turn to, online savings accounts and cash management trust accounts.  

What are the best savings choices out of online savings accounts and cash management trust accounts (CMT)?

Online Savings Accounts

Now that the internet is as popular as it is, many institutions have taken their savings accounts online and now offer a range of online savings accounts and typically offer more competitive rates than CMT accounts.

As these accounts are operated purely online banks can afford to pass on higher interest rates and offer a convenient way for people to manage their money.

CMT Accounts

These types of accounts were very popular during the 1980s and 1990s, and are still used by many Australians today. They can be described as a term deposit and an everyday transaction account rolled into one. To open one of these accounts, a minimum deposit is usually required and there are no set terms so you can access your funds at any time.

The differences between the two types

Besides the difference in interest rates, there are a few other differences between both of the accounts that you should be aware of when deciding which account is best for you:

  • Some CMT accounts may request that you outlay an initial deposit to open up the account. Online savings accounts, however, typically require a much lower or no minimum deposit.
  • Both accounts allow you to access your money at any time (however there may be some delays to receive the money), but CMT accounts may put limitations on the types of transactions such as they may not have cheque and credit card facilities.
  • When it comes to fees, CMT accounts may charge management and ongoing fees while online savings accounts usually don't charge any fees. Make sure you check with the institution for all fees and charges before applying.

At the end of the day it is up to the individual on which account you will benefit from, however you may find that you could earn more with an online savings account because they sometimes offer higher interest rates. Shop around and compare savings accounts to find one with a high interest rate. has its eyes on some of the best high interest savings accounts deals in Australia. To compare these great deals just visit our savings account comparison page.

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