As we move into 2021, millions of Aussies will be working on their financial resolutions for the year. And if you’re hoping to see your savings grow, you may be considering opening a term deposit account.
2020 was a challenging year for term deposits. RateCity research shows that the average 12-month term deposit rate for balances of $10,000 fell from 1.38 per cent from when Covid-19 hit Aussie shores in March 2020 to 0.59 per cent as of today.
But 2020 also taught us about the value of financial health. The latest research from ING found that 2.9 million Aussies feel more financially prepared going into 2021, with over a third (36 per cent) making their financial health their biggest priority.
And with the value of deposits growing by over $100 billion in just one month, according to the latest data from the Reserve Bank of Australia, it’s clear that Australians are focusing on financial safety and growing their rainy-day funds than ever before.
So, if you’ve found yourself with some extra money in the bank and you’re tossing up where to store it in 2021, you may be considering if a term deposit is right for you.
While term deposit rates have fallen dramatically since March last year, so too have savings account rates. But the difference is that those savers who locked in a fixed term deposit rate at the beginning of March would be feeling a greater level of security in their returns than those only using savings accounts, as savings accounts have variable interest rates.
In fact, seven term deposit providers hiked rates in January 2021 – including Macquarie Bank and Citi – but zero savings account providers have increased rates, according to RateCity research.
Luckily RateCity has taken the hassle out of searching for the most competitive term deposit accounts. Using our world-first rating system - Real Time RatingsTM – we’ve ranked term deposits across our database, based on interest earned and flexibility.
Best 12-month term deposits
- For more term deposit leaders, please visit our leaderboard page.