Free money

16 Dec, 2010 - 2 min read

Everyone likes the sound of free money don’t they? If you want to claim your share of free money all you need is to have money in a savings account, then you may be able to take advantage of unclaimed interest.

For instance, in September 2010, the Australian Prudential Regulation Authority (APRA) reported that Australian households had $477.8 billion sitting in their savings accounts.

At the time of writing, RateCity calculated that out of the 91 online savings accounts monitored on their website, the average interest rate is 4.36 percent and 46 percent (nearly half) offer an interest rate of less than 5 percent (current as at November, 2010).

If these savers moved their money into a savings account that earns more in interest, 6 percent for instance, collectively they could earn $3.6 billion more in interest at the higher rate.

In order to take part in your share of $3.6 billion of free money, shop around and look for a savings account that offers a much higher interest rate compared to what you are currently receiving. The best way to do this is by comparing savings accounts online or check out the table to the right which shows some of top online savings accounts currently advertised.

In November 2010, for instance, RateCity counted 21 online savings accounts that offer interest rates of 6 percent or higher. Just by depositing $2000 initially then continue to deposit $100 a month into one of the highest accounts at 6.75 percent (current as at December 1, 2010) you could earn almost $60 more than if you would if you deposited the same amount at the average rate of 4.36 percent.

If you don’t want to miss out on your portion of $3.6 billion of free money, switch your money over to an account that will work harder and watch your money grow. It may only take you half an hour or so to shop around online but it may well be worth it.

When shopping around for the right savings account for you, be aware that some of the higher rates may be for a certain amount of time, then the rate reverts to a lower amount. So make sure you read the product disclosure statement (PDS) so you are aware of the terms and conditions before you apply.

Disclaimer

This article is over two years old, last updated on December 16, 2010. While RateCity makes best efforts to update every important article regularly, the information in this piece may not be as relevant as it once was. Alternatively, please consider checking recent savings accounts articles.

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Product database updated 24 Apr, 2024

Fact Checked

Kate Cowling

Kate was one of RateCity's Personal Finance Commentators. She has been a journalist for more than a decade, most of which has been spent writing about money. Most recently, she was the Australian Financial Review's personal finance correspondent. She is passionate about personal finance and women's independence.