A bank account is the workhorse of the personal financial world. Although it doesn’t have the bells and whistles of other products, most people in Australia need one to get by.
Choose the right bank account – one that offers convenience, plenty of access and minimal fees – and it will make managing money a whole lot easier.
So, how do you choose a bank account that best suits your needs, especially with so many products on the market? Here is a quick guide to help you out.
What is a bank account?
An Australian bank account (sometimes called a ‘transaction account’ or ‘everyday account’) is an account where you can deposit your pay, receive government benefits and access your money in different ways, such as through ATM withdrawals, debit card transactions, electronic transfer and bank cheques.
A good bank account should help you manage your finances better. Think of it as a tool that allows you to direct exactly where you want your money to go. For example, you may use your account to:
- Setting up an automatic direct debit for regular payments
- Using BPAY to pay for bills
- Link to a high-interest savings account so you can set money aside as savings
- Withdraw a certain amount of cash each week for spending
- Keep tabs on whether you’ve been paid by your employer through an app
What features should I look for in a bank account?
There are many bank accounts to choose from in Australia, each offering different features that help you manage your money.
To find a bank account that suits your needs, consider the following:
When it comes to spending, ask yourself: what type of access do you need? A lot of bank accounts offer the basics – ATM access, eftpos, a debit card for purchases – but it is worth considering what type of access suits your spending habits.
Do you take cash out on a regular basis? You may want to choose a lender that has a comprehensive network of ATMs. Are you a traveller? Consider a lender that offers cash withdrawals at overseas ATMs and international money transfers. Prefer to speak to someone in person about your account? A bank with a branch near your home may be what you need.
Transaction bank accounts typically offer very low rates of interest. This means that a good way to differentiate one product from another is the fees they come attached with. Typical bank account fees you may cross paths with are:
- Account-keeping fees which cover the administration costs of managing your account
- ATM withdrawal fees if you withdraw money from an ATM (most lenders charge even more if you use another bank’s ATM)
- Eftpos transaction fee for paying with eftpos while shopping
- Branch fees for when you visit the lender’s branch for services
- Foreign transaction fee or a currency conversation when you access your money while overseas
- Electronic transaction fee for internet banking
Also check if the lender charges a fee if you don’t make a monthly minimum deposit into your account.
It is worth shopping around for a bank account with a competitive offering. Many lenders will waive monthly fees, as well as offer free services such as own bank ATM withdrawal, eftpos, direct debit and internet banking.
Online banking isn’t just for the digitally savvy; it can be a convenient option for anyone who prefers to do their banking at home or on the run.
To take advantage of the convenience technology offers, consider opening a bank account with a bank that has a mobile app and internet banking, so you can transfer money across accounts, pay bills and check your balance online. Digital wallets and contactless payments can also be a good feature to have, especially if you are the type of spender who doesn’t like to carry cash.
Tailored for my needs
While most transaction bank accounts in Australia are suitable for anyone, some lenders offer accounts specifically suited to a certain demographic or stage of life. These may include:
- Student bank accounts – for those engaged in full-time study, these bank accounts often charge no account-keeping or ATM fees
- Online-only bank accounts – online-only lenders don’t operate any branches, so they can potentially offer savings in fees
- Pensioner savings account – many lenders offer unlimited withdrawals, no monthly fee and increased fraud protection
- Joint accounts – these can be held in two names if you want to share financial management with a long-term partner, or work together towards a financial goal