RateCity welcomes the deeming rate changes, unveiled today by the government, designed to boost the pension of almost 1 million Australians.
Announced alongside the federal coronavirus stimulus package, the lower deeming rate will drop from 1.0 per cent to 0.5 per cent, while the upper rate will drop from 3 per cent to 2.5 per cent. The changes come into effect on May 1.
The highest rate pensioner account on the RateCity.com.au database is currently 1.85 per cent (for balances over $100,000), while the highest term deposit rate is 2.15 per cent for 5 years. In total there are more than 2,200 term deposit and savings accounts above the lower deeming rate.
Which banks are offering the highest deposit rates?
|Highest 6 month term deposits on RateCity.com.au|
|Highest 12-month term deposits on RateCity.com.au|
|Highest 36 month term deposits on RateCity.com.au|
|Australian Military Bank||1.65%|
|Australian Military Bank||1.60%|
|Highest savings accounts on RateCity.com.au
Note: Some pensioners may not be able to meet these conditions
|86 400||2.25%||Deposit $1000+ per month, interest paid on balances up to $100,000|
|Up||2.25%||Make 5 debit card or digital wallet purchases each month, interest paid on balances up to $50,000|
|Bank of Queensland||2.00%||Deposit $1000+ per month and make 5 or more eligible transactions, interest paid on balances up to $250,000|
|MyState Bank||2.00%||Deposit $20+ per month and make 5+ eligible transactions each month, interest paid on balances up to $150,000|
RateCity research director Sally Tindall said, “This change to the deeming rates will help older Australians get more assistance from the government.
“Savings rates have taken a battering over the last year. Plenty accounts are offering returns well under the old benchmark of 1 per cent. Even at the new low rate of 0.5 per cent, pensioners will still have to shop around to make sure the income on their savings isn’t being unfairly assessed.
“While some big bank savings rates are as low as 0.05 per cent, it is still worth shopping around because there are still rates available that are a whisker above inflation,” she said.