CBA cuts savings rates by up to 0.25 per cent

CBA cuts savings rates by up to 0.25 per cent

Australia’s largest bank, CBA, has reduced its savings rates by up to 0.25 per cent. 

This means all four big banks have now cut their savings rates following the July RBA cash rate cuts. 

CBA Netbank 

CBA has cut the ongoing rate on its Netbank savings account by 0.15 per cent. The Netbank savings account now gives you 2.05 per cent interest for the first 5 months, then an ongoing rate of just 0.15 per cent. 

 

Old rate

New rate

Change

Intro rate

2.20%

2.05%

-0.15%

Ongoing rate

0.30%

0.15%

-0.15%

CBA Goalsaver 

CBA has also cut the bonus rate on its Goalsaver account by up to 0.25 per cent. 

Balance

Old max rate

New max rate

Change

Under $50K

1.40%

1.15%

-0.25%

$50K – $249K

1.70%

1.50%

-0.20%

$250K – $999K

2.10%

1.85%

-0.25%

$1M and over

0.01%

0.01%

Nil

Max rate applies every month you make a deposit of $200 or more and no withdrawals. Otherwise it will attract the base rate of interest of 0.01% for that month. 

RateCity.com.au research director Sally Tindall said today’s cuts are another blow for savers. 

“CBA has cut some of its savings accounts by just 0.15 per cent while others have been slashed by up to 0.25 percent. 

“CBA cut the majority of its variable home loan rates by just 0.19 per cent so it’s disappointing to see some cuts to savings accounts have gone above this. 

“Now is an excellent time to review your savings accounts and see if you are getting the most bang for buck in what is a very difficult market for savers.” 

How the big bank savings accounts stack up post July cash rate cut: 

Big four savings accounts – conditional rates 

Bank

Product

Base rate

Max. rate

How to earn max. rate

CBA

Goalsaver

0.01%

1.15%*

Deposit $200 and no withdrawals per mth

Westpac

Life

0.60%

2.10%

Make a deposit and end with higher balance per mth

NAB

Reward Saver

0.11%

1.86%

One deposit and no withdrawals per mth

ANZ

Progress Saver

0.01%

1.95%

Deposit $10 and no withdrawals per mth.

 * For balances under $50K. CBA offers higher rates for higher balances.

 Big four savings accounts – introductory rates 

Bank

Product

Base rate

Max. rate

Introductory term

CBA

NetBank Saver

0.15%

2.05%

5 months

Westpac

eSaver

0.15%

2.16%

5 months

NAB

iSaver

0.11%

2.11%

4 months

ANZ

Online Saver

0.15%

1.95%

3 months

 Some of the highest savings account rates on RateCity.com.au 

Bank

Max rate

Conditions

Endeavour Mutual Lifestyle Account

2.75%

Deposit $400/mth. Up to age 35

MyState Bank Bonus Saver Account

2.60%

Deposit $20/mth and make 5 transactions from linked account

RAMS Saver

2.55%

Deposit $200/mth and no withdrawals

Australian Unity Active Saver

2.35%

Deposit $250/mth and no withdrawals

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Learn more about savings accounts

What is the interest rate on savings accounts?

As banks frequently change their rates, the most accurate way to look at interest rates on savings accounts is to use a savings accounts comparison tool. When you look at the savings rate check what the maximum and minimum rates are. Often banks will offer you a promotional rate for the first few months which is competitive, but then revert back to a base rate which can sometimes be less than inflation. Ongoing bonus rates are often a safer bet as they will keep rewarding you with the maximum rate, provided you meet their criteria

What are the two types of NAB locked savings accounts?

With a locked savings account in NAB, you can earn bonus interest and learn financial discipline. NAB offers two types of locked savings accounts, each with their own terms and conditions.

The NAB Reward Saver account pays a variable base interest rate of 0.05 per cent per annum and a bonus interest of 0.55 per cent. You’re eligible for the bonus if you make a minimum of one deposit on or before the second last banking day and have no withdrawals in the month.

Meanwhile, the NAB iSaver account provides 0.05 per cent as the standard base interest rate and a fixed bonus margin of 0.55 per cent during the first four months from the date of opening the account. You can park your cash in the account and enjoy unlimited monthly transfers between linked daily bank accounts without impacting the interest rate.

What is an ANZ locked savings account?

An ANZ locked savings account locks your money and prevents you from spending. You may use a standard savings account as the account where your salary is deposited. You can then withdraw funds when needed, but aren’t able to make purchases with it. However, this account may not grow much as the continual withdrawing of funds will limit the interest you can earn.

With a locked savings account in ANZ, you know your savings will grow because you can’t access the money. You can also qualify for a bonus when you deposit at least $10 per month and don’t make any withdrawals. To help you with this further you can set up an automatic transfer from your regular ANZ savings or transaction account so you don’t forget to make a monthly deposit.

Your ANZ locked savings account offers you a base interest rate of 0.1 per cent per annum plus an additional bonus interest of 0.49 per cent per year. The interest is calculated daily and credited to your account on the last working day of the month.

What is a Westpac locked savings account?

The Westpac locked savings account (also known as "Westpac Life") can help customers reach savings goals faster through bonus interest. Customers receive 0.2 per cent standard base interest with a variable bonus rate of 0.35 per cent when the closing balance at the end of the month is higher than the opening balance.

There are some conditions to earn the bonus interest on Westpac's locked savings account, though. First, you’ll need to increase the balance each month either through a deposit or not making any withdrawals, and then link it to a Westpac Choice account and make at least five eligible payments using your debit card. Please consult your bank as to what an eligible payment is. 

Can you have multiple ING savings accounts?

Yes, you can open up to nine accounts with ING at any particular time. If you’re saving money for various goals, such as buying a car or taking a holiday, you can name each of your multiple ING savings accounts differently.

To get a Savings Maximiser account, you’ll need to deposit more than $1000 every month and make at least five additional purchases. If you also want to grow your savings, from 1st March 2021, you can earn up to 1.35 per cent per annum variable interest on one account with a balance of up to $100,000 when you also maintain an Orange Everyday account.

With ING, multiple savings accounts can help keep track of all your savings goals. All the accounts offer flexible withdrawals where you can withdraw as low or as high as you want without impacting your earning interest rate. However, you can only earn the bonus interest on one account. To apply for a Savings Maximiser account, you can visit ingdirect.com.au.

Who has the highest interest rates for savings accounts?

As banks frequently change their rates, the most accurate way to know who currently has the highest interest rate is to use a savings account comparison tool.

What is a good interest rate for a savings account?

A good rule of thumb to keep in mind with savings accounts is to look for a rate that is higher than the CPI inflation rate. This number is constantly changing, so check the Reserve Bank of Australia’s page. If you aren’t earning interest above this then the value of your money will go backwards over time.

How to make money with a savings account?

Savings accounts make you money by earning interest on your savings. The more money you deposit, the longer you leave it in the account, and the higher the account’s interest rate, the more interest you’ll be paid by the bank or financial institution, and the more your wealth will grow.

To make sure your savings account makes money and doesn’t lose money, it’s important to maintain a large enough minimum balance that the annual interest earned exceeds any annual fees charged on the account.

Should I open a Commonwealth locked savings account?

If you have trouble saving money, a Commbank locked savings account could be a potential solution. A locked savings account won’t let you make withdrawals and as such, it can help you grow your savings balance if you keep topping it up. 

The Commonwealth locked savings account advertises high-interest rates and minimal maintenance fees, along with a host of other incentives that will encourage you not to touch the money. 

The account offers a higher interest rate for each month that you make limited or no withdrawals, as well as regular deposits. 

To qualify for a Commonwealth locked savings account with the advertised features, you will need to fulfil specific criteria such as:

  • Depositing a fixed minimum amount into the account every month.
  • Making a fixed number of deposits each month.
  • Making a minimum or no withdrawals each month.
  • Maintaining a minimum account balance.

What is a savings account?

A savings account is a type of bank account in which you earn interest on the money you deposit. This makes it one of the easiest and safest investment tools.

How to open a savings account for my child?

Some banks and financial institutions allow parents to open a bank account for their child as soon as it is born, and start depositing funds to go towards the child’s future.

Children’s savings accounts generally don’t have fees, and are structured to help develop positive financial habits by limiting withdrawals, encouraging regular deposits, and earning interest on the savings, similarly to standard savings accounts.

Can you set up direct debits from a savings account?

It’s not usually possible to set up a direct debit from your savings account to cover ongoing expenses or bills, as savings accounts are structured around growing your wealth by earning interest on regular deposits, and discouraging withdrawals.

Some transaction accounts allow you to set up direct debits and also earn interest, though you may not enjoy as much flexibility as a dedicated transaction account, or get as high an interest rate as a dedicated savings account.

Can you set up a savings account online?

Yes. Several large and small banks offer online applications for savings accounts, and there are also online-only financial institutions to consider.

Online-only savings accounts are often less expensive than other savings accounts, though they may not offer the same flexibility, features, or face-to-face service as more traditional savings accounts.

How do I open a savings account?

Opening a savings account is a relatively simple process. If you’ve found an account with a suitable interest rate, you’ll just need to get in contact with your chosen lender via a branch, phone call or hop online to begin the process. 

You may be required to provide:

  • Personal details, including identification (driver’s license, passport etc.)
  • Tax file number
  • Employment details