The following table shows the rate increases for Australian banks whom have an indentifiable high interest savings account suitable for Self Managed Super Funds (DIY Super).

Compare DIY Super savings accounts

Warning: Product features such as interest rates and fees can change without notice. Please check all details with the product provider prior to taking any action.

Despite these “extra costs” they are making record profits. Does this seem fair?

You are paying for the Big 4 Bank Profits.

“ANZ Banking Group Ltd says its third quarter net profit was up 37 per cent”
“THE Commonwealth Bank has delivered a record $5.66 billion profit, fuelling claims of profit-gouging”
“The National Australia Bank has reported a 63-per cent jump in full-year profits to $4.2 billion”
“Westpac profit soars 84% to record $6.4bn”

Here’s what you can do to beat them at their own game.

Get out of your comfort zone!

Most Australian’s bank with the big 4 (ANZ, Commonwealth Bank, NAB and Westpac) and most people have, bank , savings accounts, credit cards, car or personal loans and a mortgage or home loan. If you take a little time to compare what’s available, get out of your comfort zone and actually move your custom to the better alternatives you will save money and force the big banks to compete.

Did you know three of the big 4 actually have smaller subsidiaries.

• Commonwealth Bank owns Bankwest.
• NAB owns UBank.
• Westpac owns St George Bank.

These subsidiaries typically allow the big banks to engage in more competitive practices to combat the lesser known players (in Australia) such as ING Direct, Rabo Australia, Citibank and HSBC. You will typically find that the interest rates offered by these subsidiaries and lesser knowns banks are more competitive than the big 4.

Now note the last banks mentioned. These are not small banks but some of the largest banks in the world whom have an Australian presence. If you are worried about having your money or loans with banks smaller than the big 4 then this is not a reason to discount these banks.

You have to be prepared to widen your view past your childhood school bank account if you want to save.

You don’t have to have all your eggs or bank products in one basket because managing multiple accounts with internet banking is easy.

One bank might have the best home loan rate whilst another might have the best savings account interest rate. Using the net makes it easy to transfer money between banks and you can ask your bank not to send you hard copy statements to cut paperwork.

Kick them where it hurts. Show them what loyalty means. Don’t get mad, get even.

Top 10 Ways to Screw the Big 4 Banks

1. Transfer all surplus cash to a high interest savings account. Compare high interest savings accounts.
2. Transfer your mortgage to a lower interest rate home loan. Use a reputable mortgage broker to save time.
3. Open a no monthly fee transaction account and arrange for your wages to be deposited into it.
4. Pay down or pay out outstanding credit card balances and close the card or transfer to a no annual fee credit card.
5. Balance transfer large credit card debts to a low interest credit card.
6. Don’t get sucked in by credit card rewards programs that you fund with higher fees. Transfer to a low interest or no annual fee credit card.
7. Debt consolidation. Amalgamate high interest loans (personal loans, car loans, credit cards) into your home loan and keep making repayments at the old level.
8. Check out the more competitive subsidiaries – CBA/BankWest, Westpac/St George, NAB/UBank.
9. Play them off. Tell your bank you are going to leave for a lower cost competitor and ask them to match it. Check exit fees payable before taking any action.
10.Get the best banking product wherever you can. With internet banking you don’t need to have all your products with the same provider.

Compare, move and save or they will treat you as they do now.

Warning: The majority of bank loan products (home loans and personal loans) and some other bank products will have exit or early repayment fees that may be applicable. You must find out what these are before taking any action. Any decision to change products must take these factors into account. Please seek advice from an appropriate professional adviser before taking any action.

Bank Products and Services

Citibank Citigold
Requirements: minimum deposits or investments with Citibank of at least A$100,000

Members of Citigold get a Relationship Manager, who is a combination investment adviser and banker who will ‘proactively pursue the right financial solutions for you’. They act as your central point of contact with the bank and can seek further advice from internal investment, mortgage or treasury consultants if required. Regular reviews of your financial situation are an included benefit.

Along with access to the full suite of Citibank products you will be eligible for discounts on annual credit card fees for the Platinum Credit Card, reduced fees on certain mortgage products, preferential pricing on Term Deposits, 50% discount on Financial Planning Plan preparation fee, discounts of up to 45% on various insurance products and preferential rates on Foreign Exchange transactions.

Other services include; worldwide Citigold Emergency Healthcare Service, Citigold Global Banking, Seminars, regular updates on investments and research.

HSBC Premier
Requirements: minimum of $500,000 in total loans or $200,000 in HSBC deposits or investments or a combination of the two. You must also maintain a HSBC Premier Cash Management Account.

You get a HSBC Premier Relationship Manager who is ‘dedicated to helping you meet your financial goals’. As well as having access to the HSBC Premier Financial Planning service, members get preferential pricing, discounts or fees waived on a number of services or products including; mortgages, deposit products, stockbroking and bank charges.

If you would like to visit the ski resort of Hotham at Mount Hotham in the Victorian ski fields then you can take advantage of HSBC’s exclusive Snow Holiday deals.

Foreign Currency Accounts
Both Citibank and HSBC offer Dual Currency Accounts and Multi Currency Accounts.

Credit Cards

For brevity we have only compared the lowest rate credit cards. For more information click the links below.

• Compare Citibank Credit Cards
• Compare HSBC Credit Cards

Savings Accounts

Name	Interest Rate
Citibank Online Saver	6.35% pa intro rate (6 mths) then 5.25% pa
HSBC Serious Saver	5.00% pa for every month you don’t withdraw

Interest on Bank Accounts

The Treasurer outlined a 50% tax discount on the first $1,000 of interest earned. This gives potential savings of $75 for those on a marginal rate of 15% and $225 for those on the top marginal rate of 45%. This change is expected to come into force from 1 July 2011 and is to apply to interest bearing deposits with authorised deposit taking institutions which includes bank accounts, term deposits, bonds, annuities and debentures.

First Home Saver Account Changes

Previously if you held a First Home Saver Account (FHSA) and purchased a new home before the end of the qualifying period of 4 years then the account proceeds would have been compulsorily transferred to your superannuation account. The nominated changes will now see the funds go into your eligible mortgage at the end of the four year qualifying period.

Superannuation

Superannuation Co-contribution

The matching by the Government of personal super contributions was to increase from 1 July 2012 to $1,250 and again at 1 July 2014 to $1,500. Now it will remain at $1,000. Furthermore the thresholds on which the co-contributions are based will be frozen for the next two years. The current threshold under which you could receive the maximum co-contribution is $31,920 with the fade out threshold $61,920.

New Concessions for Superannuation Guarantee Contributions

The Government has indicated that in will effectively remove the contributions tax on normal employer superannuation contributions for workers on incomes up to $37,000 from 1 July 2012. The contributions tax on the current 9% super contribution for someone on an income of $37,000 is approximately $500.

12 per cent Superannuation Guarantee

The Government has indicated that it will legislate to increase the superannuation guarantee, from the current 9% to 12%, incrementally by 0.5% pa from 1 July 2013 until 2019/20.

Increase in eligibility for compulsory Superannuation Contributions to age 75

From 1 July 2013 the maximum threshold for compulsory superannuation contributions will be lifted to 75 years.

Superannuation Concessional Cap

The concessional cap on superannuation contributions for individuals over 49 years of age and with less than $500,000 in super will be lifted to $50,000 pa from 1 July 2012.

Tax

Simple Treatment of Work Related Expenses

From the 2012-13 financial year tax payers will provide have a choice of a $500 standard deduction to replace deductions for their work related expenses and cost of managing tax affairs. This is slated to increase to $1,000 in 2013-14.

For those with more complex needs they will be able to continue to claim expenses by the current methods.

Low Income Earner Tax Offset (LITO)

The Low Income Earner Tax Offset will be increased to $1,500 with a $30,000 fade out threshold. This means that a individual earning less than $16,000 or a recipient of a superannuation pension of $48,158 should pay no tax.

Senior Australian Tax Offset (SATO)

The maximum a senior Australian can earn before paying tax or the Medicare levy will now be $30,685 for singles and $26,680 for members of a couple.

Child Care Rebate

The annual Child Care Rebate is to be dropped from the current $7,778 to $7,500 with indexation suspended for the next 4 years.

For more details visit the Government Budget website

Previously there was a four year waiting period before the First Home Saver Account (FHSA) could be used to help purchase a new home. If you did buy a home within this time period then the balance of the FHSA would be compulsorily transferred to your superannuation account.

The proposed changes will enable the accumulated account balance at the end of the the four year period to be paid into an eligible mortgage. So if you purchase a home within the 4 year qualifying period you have to wait to the end of it before the funds can be released into your new mortgage.

Budget Overview

Compare FHSAs