High Interest Savings Accounts with bonus interest for Regular Savings

High Interest Savings AccountsAre you making regular deposits into a savings account? You might be interested then in finding out which bank products offer an incentive to regular savers. There are quite a few financial institutions that offer savings accounts with incentives to make regular monthly deposits however not all offer much in terms of a bonus.

There are a quite a few variations on the eligibility to qualify for these bonuses so please check the details carefully before making any decision. Common qualifications include:

  • minimum monthly deposit amount
  • restrictions on making withdrawals (ie if you withdraw funds then you don’t qualify)
  • maximum account balance
  • transaction account with same bank

Most have a minimum amount you need to deposit each month and may also have restrictions on whether you can actually withdraw funds and still qualify for the bonus interest. Only products that have an incentive for regular monthly deposits have been listed. Many of the banks have other savings accounts that actually have higher interest rates even taking into consideration the bonus rates so if you want to open an account with your favourite bank check their other products first.

BankStandard Rate %Total including Bonus Rate %Minimum Monthly DepositOther Requirements
ANZ Progress Saver0.014.51$10No withdrawals
Commonwealth Bank AwardSaver0.015.76$1Bonus interest 5.50 until 30 June 2011 for new accounts
Make at least one deposit and no withdrawals each month
Applies on balances under $50,000
NAB Smart Reward Saver0.014.26$1Make at least one deposit and no withdrawals each month
Westpac Reward Saver1.005.95$50Make at least one deposit of $50 or more and no withdrawals each month
Normal bonus rate is 3.40% with an additional 1.55% for 4 months on accounts opened between 12/04/10 and 09/05/10
Bankwest Regular Saver0.006.00$50 ($500 maximum)Max opening balance $500
Deposit between $50-$500 per month with no withdrawals
Deposits greater than $500 each month will be swept to linked transaction account
Must be linked to an eligible Bankwest transaction account
RaboPlus PremiumSaver4.005.75$200Withdrawals allowed but monthly balance must increase by deposits of at least $200
UBank USaver5.855.95$100Must set up a monthly Automatic Savings Plan
Total balance must not exceed $150,000

There are two products that standout from the rest, Bankwest’s Regular Saver and UBank’s USaver. The Bankwest product has the higher interest rate but has a fair number of requirements in that you need to deposit between $50 and $500 per month, link it to an eligible Bankwest transaction account and and if you make a withdrawal you get nil interest. The maximum opening balance is also just $500. The USaver product on the other hand only requires you to initiate an Automatic Savings Plan for at least $100 per month and has a maximum eligible balance of $150,000. USaver’s bonus rate of 0.10% isn’t huge but when added to the standard rate of 5.85% it is.

Things to Consider

Many of the products considered had an overall interest rate less than other high interest savings accounts with the same bank.

If you are saving for a home deposit and have never purchased a home before then you might be better off considering First Home Saver Accounts (FHSA) where the Government contributes 17% of what you contribute each year on the first $5,000.

Whilst most of the accounts require you to be 18 or over some like the Bankwest Regular Saver allows younger account holders. If you are under 18 years of age you need to consider the taxation consequences of your earnings as minors have special tax rates. If you are a parent you might consider the alternative of opening an account in trust for your child if the earnings are going to be significant. Also, if you are married, you might also consider who is paying a lower rate of tax on interest income. Obviously you need to consult your tax adviser or financial planner to get qualified advice in these matters.

All interest rates were correct at time of publication. Please check with product providers to confirm before making any decision.

Disclaimer: Product interest rates and features change without notice. Please check with the product provider before making any decision and consult your financial planner if you require advice.