Fixed Term Investment

A fixed term investment is a type of investment where your money is locked away for a certain amount of time at a fixed interest rate. Some examples of fixed term investments include: If you are considering investing your money into a term deposit, below is some information that will help you decide whether they are a good investment option for you.
  • They are a fixed term investment where your money is locked away for an agreed amount of time. In this period your money accrues interest at the agreed interest rate.
  • Depending on how much money you have and your goals, there are two types of term deposits available to choose from:
    • Short-term deposits ??? Available if you want to invest your money for short periods of time, usually between one month to one year in length
    • Long-term deposits ??? These are usually from one year up to approximately seven years.
  • Compared to other types of investments such shares, term deposits are considered a lower-risk and secure form of investment.
Once your money is locked away you can???t access it, however if for whatever reason you decide that you need it, you must be willing to pay a fee. The amount you will be charged will depend on the financial institution, but typically a percentage is deducted off your fixed interest rate. For instance if your fixed rate was 6.40 percent they may take 3 percent off this, so you will only receive 3.40 percent in interest.

Another thing to be aware of is that once your term deposit reaches maturity you need to notify your financial institution whether you want re-invest your money into another fixed term investment or withdraw. If you don't let them know what to do with your investment your term deposit automatically rolls itself over for the original investment term. But the interest rate can potentially be much lower than your original rate as it is set at the current rate.

Compare term deposits online to see what interest rates are available or view the table below for 1-year term deposits. Make sure you read the product disclosure statement (PDS) before applying so you are aware of all the fees and charges.
This is an information service. By browsing on the website and/or using our search tools, you are asking RateCity to provide you with information about products from multiple financial institutions. We will try to show you a range of products in response to your request for information. The search results do not include all providers and may not compare all features relevant to you, for further details refer to our FSCG. The rating shown is only one factor to take into account when considering these products. We are not a credit provider, and in giving you product information we are not making any suggestion or recommendation to you about a particular credit product. If you decide to apply for a product, you will deal directly with a financial institution, and not with RateCity. Rates and product information should be confirmed with the relevant financial institution, and you should review the PDS before you decide to purchase. See our terms of use for further details. This advice is general and has not taken into account your objectives, financial situation or needs. Consider whether this advice is right for you.