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Long term deposits paying 3.20%

Long term deposits paying 3.20%

Today’s stingy term deposit market is forcing consumers to lock their money away for long terms if they want to maximise their returns.

For those looking to invest $5,000 for 12 months, ME Bank is offering one of the highest term deposit interest rates on the market, at 2.80 per cent (see table below).

That would earn you $140 of interest, leaving you with $5,140 at the end of the term.

If you were to lock that $5,000 away for three years instead of one, you could earn 3.00 per cent interest.

At the moment, The Mutual, Big Sky, Heritage Bank, QBank and ME Bank are all paying 3.00 per cent for three-year term deposits, which would leave you with $5,450.

Returns are slightly better for five-year term deposits, with Greater Bank paying 3.20 per cent.

At that rate, your $5,000 would turn into $5,800 at the end of the five-year term deposit.

$5,000 for 1 year

LenderInterest rateFinal total
ME Bank2.80%$5,140
People’s Choice Credit Union2.70%$5,136.80
Teachers Mutual Bank2.65%$5,132.50

$5,000 for 3 years

LenderInterest rateFinal total
The Mutual3.00%$5,450
Big Sky3.00%$5,450
Heritage Bank3.00%$5,450
ME Bank3.00%$5,450

$5,000 for 5 years

LenderInterest rateFinal total
Greater Bank3.20%$5,800
People’s Choice Credit Union3.00%$5,750
Big Sky3.00%$5,750

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This article was reviewed by Personal Finance Editor Mark Bristow before it was published as part of RateCity's Fact Check process.



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