Nearly three quarters of Aussie couples clash over money

Nearly three quarters of Aussie couples clash over money

Valentine’s Day is just around the corner, but when it comes to your finances, mixing love and money is still proving tricky for many Aussies.

The latest research from smartbank, 86 400, shows that nearly three quarters (74 per cent) of 1000 surveyed Australians admitted to having disagreements with their partner about money.

Money is particularly contentious at the beginning of a relationship (or for younger Australians) according to the survey. 82 per cent of 18-24-year-olds argued with their partners over money. But only 55 per cent of 35-44-year-olds clashed when it comes to their finances.

In fact, 86 400 research found that more than a quarter (27 per cent) of all respondents admitted to thinking their partner is not good with money.

And speaking of the day of love, for those expecting a Valentine’s Day gift, keep an eye on your joint account. 65 per cent of male respondents admitted to using money from a shared account to buy presents for their partner.

More 86 400 survey results on how Aussie couples share money: 

  • More than a third (36 per cent) of respondents take 1-3 years to combine their finances with a partner. A quarter (28 per cent) combine their finances within one year of being in a relationship, and only 17 per cent wait between 3 and 5 years.
  • Less than half (45 per cent) of respondents choose to share their finances due to getting married. However, this was the biggest reported trigger for combining finances.
  • 2 out of 3 respondents (66 per cent) use their shared accounts to pay bills, such as rent, utilities and groceries.

The joys of joint accounts

Combining finances into one account is not a concept just reserved for couples. Many households – whether families or flatmates – find it an easier financial solution to pay bills or save for life events, like holidays or renovations.

Most bank and savings account providers allow customers to open joint accounts. However, there are some providers offering innovation in the world of shared finances.

In December 2020, 86 400 launched Shared accounts, featuring a 30-second sign up process for applicants. Signing up for a standard joint account typically takes longer than if you went it alone, as the provider needs to assess the personal information of more than one applicant. 30-second sign up processes shorten this time significantly.

Further, Revolut’s Vault account allows more than one Revolut customer to join together their savings goals into a Group Vault. Friends and family can link their bank accounts to the same group. The Group Vault allows you to round up any spare change into it, deposit dedicated amounts each month or even invest a one-off amount in different currencies, including Bitcoin. Withdrawal permission also needs to be granted for members to dip into any funds, so it limits the amount of potential relationship stress involved.

When it comes to mixing money with love – whether romantic, familial or platonic – it’s worth keeping in mind that it can add additional stresses to any relationship. Ensure you trust the individual or group you’re considering combining finances with and set clear rules and expectations before you apply.

High interest joint savings accounts

   

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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 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

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

Can you have a joint savings account?

Yes. Joint savings accounts can be useful for two or more people wanting to combine their savings to meet shared financial goals, including spouses, flatmates and business partners.

Some joint savings accounts require all parties to sign before they can access the money. While less convenient, this extra security can help encourage all parties to meet their shared financial goals.

Other joint savings accounts allow any of the account holders to access the money. These accounts can be convenient for financially responsible couples that trust one another implicitly. 

How can I get a $4000 loan approved?

While personal loans and medium amount loans don’t offer guaranteed approval, there are steps you can take to help increase the likelihood of your application being approved, including:

  • Fulfilling the eligibility criteria (providing ID, proof of residency, proof of income etc.)
  • Checking your credit history (you can order one free copy of your credit file per year, and make sure that there aren’t any errors that may be bringing down your credit score)
  • Comparing carefully before applying (making multiple loan applications can mean having your credit checked multiple times, which can look bad to some lenders and reduce your chances of being approved by them)

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.

How does interest work on savings accounts?

The type of interest savings accounts accrues is called compound interest. Compound interest is interest paid on the initial deposit amount, as well as the accumulated interest on money you have. This is different from simple interest where interest is paid at the end of a specified term. Compound interest allows you to earn interest on interest at a higher frequency. 

Example: John deposits $10,000 into a savings account with an interest rate of 5 per cent that he leaves untouched for 10 years. At the end of the first year he will have $10,512 in savings. After ten years, he will have saved $16,470.

Can I overdraft my savings account?

A lot of savings accounts won’t let you overdraw. Some will allow this feature but you’ll need to apply first. It’s best to read the fine print and check with your lender whether this is a feature they offer. It can be a helpful addition, but as your lender can charge you a fee as well as interest for going into negative numbers, it’s best to avoid overdrafting when possible.

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.

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.

How much money should I have in my savings account?

A good rule of thumb when working out a minimum balance for your savings account is to make sure that you’ll earn more in annual interest on your savings than what you’ll be charged in annual fees.

If you’re saving with a specific goal in mind, prepare a budget so the interest you earn on your deposits will help you efficiently reach this goal. Online financial calculators may be helpful here.

Do I have to claim interest on my savings account?

When you lodge your income tax returns, you must include in the documentation all your sources of income, including bank interest. Your bank will report any interest you earn on the funds in your savings account to the Australian Tax Office (ATO). When the ATO then compares this information with your tax returns,  you also need to have mentioned the interest earned. If there is any discrepancy, you’ll receive a letter from the ATO. 

Avoid this situation by ensuring you receive your bank statement with interest noted. Then declare the interest in your tax returns and pay the tax that’s applicable based on the income tax rate.

You only need to claim your share of the interest earned for joint accounts. If you manage an account for your child and receive or spend money via this account, you will also need to report any interest earned from said account.

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.