How to find a bank account that rewards you



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Following recent RBA cash rate cuts, many leading banks have slashed interest rates on their savings accounts, term deposits and other bank accounts, making it harder for everyday Aussies to grow their wealth.  

So if you want a simple way to earn a little money on your savings, what should you look for when choosing a bank account?

Interest rate – base rate vs maximum rate

The simplest way to be rewarded for your everyday banking is to choose an account that earns you interest on your savings. This usually means looking for a dedicated savings account, rather than an everyday transaction account.

To get an idea of how much interest you can earn with a savings account, look at both its base rate and its maximum rate. The base rate is the minimum interest you’ll earn on savings in your account, while the maximum rate is how much interest you could potentially earn, provided you fulfil the account’s terms and conditions.

Special offers

Some bank accounts and savings accounts offer additional features and benefits that can prove valuable to the right saver. 

These could include:  

  • discounts on the bank’s other financial products
  • cash back on your spending
  • access to other exclusive rewards

Example

HSBC recently added the Everyday Extras rewards program to its Everyday Global Account, allowing account holders to earn up to 2% cash back on eligible tap and pay purchases under $100. This could allow an account holder to earn up to $600 per year in cash back.

Plus, Everyday Global Account holders who also hold HSBC Serious Saver Accounts would receive an additional 0.40% bonus interest on top of that account’s ongoing variable rate, to further grow their wealth.

Terms and conditions 

To enjoy higher interest rates and other features and benefits, most banks will require you to fulfil certain terms and conditions, often designed to help encourage you to save.

These may include:

  • Making a minimum number of deposits per month
  • Depositing a minimum balance per month
  • Making no withdrawals, or keeping your withdrawals under a maximum number 

Several savings accounts offer higher introductory interest rates, where new customers can earn more interest for a limited time after opening a savings account. After the introductory period expires, these savings accounts will often revert to a standard interest rate, which is typically lower than the intro rate.  

Example

To receive the benefits of Everyday Extras described earlier, you’ll need to deposit a minimum of $2000 per month in your HSBC Everyday Global Account.

Also, the introductory rate on the HSBC Serious Saver Account applies for the first four months, before reverting to the ongoing variable rate, and interest is paid every month you don’t make a withdrawal.

Further terms and conditions apply to both accounts.

Fees and charges 

Like many other financial products, some savings accounts and bank accounts charge fees. These can include upfront fees when you open the account, or ongoing fees to help cover the account’s admin costs.

One quick way to estimate if a bank account will be worth it for you is to use a savings calculator to find how much interest you could earn from the account in a year, and to compare this to the annual cost of any fees.

If you’ll pay more in fees than you’ll make in interest, you may want to consider other options. But if you’ll enjoy more in value than you’ll pay in fees, then the bank account may be one to add to your shortlist.

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