Savers get a boost as new highest rate hits 4.60% for all adults

It’s showtime for the highest savings accounts as banks break the 4.5 per cent savings rate barrier on the back of the RBA’s historic eighth consecutive cash rate rise.

Today, ING has announced it will hike its popular Savings Maximiser account by 0.25 percentage points to a maximum ongoing rate of 4.55 per cent, effective next Tuesday (13 December).

Yesterday, Virgin Money announced it will hike its Boost Saver to a maximum ongoing rate of 4.60 per cent, effective tomorrow – a total increase of 0.45 percentage points. This is the new highest ongoing savings rate in the market available to all adults.

To get the maximum rate, however, savers must give 32 days’ notice to access funds, in addition to other monthly terms and conditions.

Bank of Queensland has also announced it will increase its Future Saver account by 0.40 percentage points to a maximum ongoing rate of 4.75 per cent, effective tomorrow. This account, however, is for people aged 14 to 35.

This is the new highest ongoing savings rate in the market.

All adults: Highest ongoing savings rates on the RateCity database

RateCity.com.au analysis shows five banks currently offer savings accounts to all adults with an ongoing rate of more than 4%: ING, MOVE Bank, Virgin Money, People’s Choice and uBank.

• 4.60%: Virgin Money Boost Saver, effective 9 December on balances up to $250,000.

  Conditions: Savers must deposit $2,000 a month into a linked transaction account, make 5 or more transactions on the linked account and provide 32 days’ notice to access funds.

• 4.55%: ING Savings Maximiser, effective 13 December on balances up to $100,000.

  Conditions: Savers must deposit $1,000 a month into a linked transaction account, make 5 or more transactions on the linked account and grow their savings balance each month.

Young adults: Highest ongoing savings rates

• 4.75%: BOQ Future Saver, effective 9 December on balances up to $50,000.

  Conditions: Savers must deposit $2,000 a month into a linked transaction account, make 5 or more transactions on the linked account. Bonus criteria waived for people under 18.

• 4.35%: Westpac Spend&Save, effective 16 December on balances up to $30,000.

  Conditions: Savers must grow their savings balance each month and make 5 or more purchases on their linked transaction account.

Highest term deposit rates on RateCity.com.au

Term deposit rates continue to climb on the back of the rising cash rate and the forecasts for next year.

The highest term deposit rate is now 4.95 per cent from Judo Bank, however, savers have to be willing to lock up their cash for five years.

Source: RateCity.com.au. AMP rate is for deposits over $25K.

RateCity.com.au research director, Sally Tindall, said: “It’s showtime for savers looking to maximise their cash, as banks fight it out for their business.”

“Virgin, ING and Bank of Queensland have broken the 4.5 per cent barrier, which is terrific news for keen savers willing to jump through a few hoops in order to get a competitive rate,” she said.

“However, people with money tucked away in the bank shouldn’t just assume their cash is benefiting from rising interest rates.

“The big four banks’ online saver accounts might have no terms and conditions but they’re offering up next to nothing in return, with ongoing rates ranging from 1.60 per cent, all the way down to just 0.60 per cent in the case of ANZ.

“Savers should be aiming for an ongoing rate that’s well clear of the cash rate at an absolute minimum. If not, they’re getting fleeced.

“Term deposit rates are also continuing to climb on the back of the rising cash rate, and confirmation from the RBA it expects more hikes in 2023.

“While term deposits are becoming an increasingly popular choice for some savers, people looking to lock up their cash would do well to shop around.

“Don’t just sign up to the best deal on offer from your current bank. Spend some time thinking about what term best suits your savings goals and find a competitive rate.

“The government guarantees your cash up to $250,000 per person, per institution provided your account is with an authorised deposit-taking institution,” she said.

Source: RateCity.com.au. Rates are the maximum ongoing rate offered.

Then and now: how far savings rates have risen compared to the cash rate

Big four banks’ savings rates

Source: RateCity.com.au. Note: Rates are for existing customers and do not include introductory rates. Terms and conditions apply for some maximum rates. CBA and Westpac increases effective 16 December. ANZ and NAB yet to announce any Dec savings rate increases.

Highest ongoing savings rates – then and now

Source: RateCity.com.au. Monthly conditions apply for max rates. * Bank has not announced RBA December hike. Virgin & BOQ rates effective 9 Dec, Westpac 16 Dec.

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