Online Savings Accounts Comparison and Application

Posted November 2nd, 2009 and last modified July 17th, 2014

Achieve your financial and savings goals the easy way with an online savings account.

Everybody is now becoming more technologically savvy and looking for ways they can save money. Online savings accounts allow you to conduct all your banking and saving online and potentially avoid bank fees. You can let your savings grow and manage them online without needing to leave the house.

Bankwest TeleNet Saver

Savings Accounts Comparison

Enjoy a high rate on your savings with the Bankwest Telenet Saver. Save on fees and no minimum monthly deposit.

  • Maximum Rate: 4.09% p.a.
  • Standard Variable Rate: 2.70% p.a.
  • Bonus Rate: 1.39% p.a.
  • Monthly Account Fees: $0
  • Minimum Balance: $0
  • Minimum Deposit: $1

Compare Online Savings Accounts

Rates last updated August 2nd, 2014.
Maximum Variable Rate p.a. Standard Variable Rate p.a. Bonus Interest p.a. Fees Min Bal / Min Deposit
Bankwest TeleNet Saver
Bankwest TeleNet Saver
No Fees. No minimum monthly deposit. For balance up to $5,000,000. Earn a high 4.09% p.a. variable rate for 4 months. 4.09% 2.70% 1.39% $0 $0 / $1 OpenMore
ING DIRECT Savings Maximiser
ING DIRECT Savings Maximiser
Earn high interest rate of 4.00% p.a. for 4 months for opening balances up to $250,000. No fees, fixed term or minimum balance. 4.00% 2.75% 1.25% $0 $0 / $0 OpenMore
HSBC Serious Saver
HSBC Serious Saver
Earn up to 4.00% p.a. for 4 months. An incentive to help you save by rewarding you every month if you don't make a withdrawal. 4.00% 2.90% 1.10% $0 $0 / $0 OpenMore
ANZ Online Saver
ANZ Online Saver
The ongoing interest rate makes the ANZ Online Saver a great account. 3.80% 2.50% 1.30% $0 $0 / $0 OpenMore
Westpac eSaver
Westpac eSaver
Earn 4.00% p.a. variable rate for 3 months with no minimum balance and no monthly service fee. 4.00% 2.50% 1.50% $0 $0 / $0 OpenMore
St.George Maxi Saver
St.George Maxi Saver
Enjoy this fantastic rate from one of the Australian largest banks. 4.05% 2.25% 1.80% $0 $1 / $1 OpenMore
Westpac Reward Saver
Westpac Reward Saver
Enjoy bonus interest each month if you make no withdrawals, and deposit at least $50. 3.71% 0.01% 3.70% $0 $0 / $0 OpenMore
Easy Street - Easy Savings Account
Easy Street - Easy Savings Account
Earn a high interest rate of 2.75% p.a.. A high ongoing interest rate with no fixed term, no minimum balance and no fee. 2.75% 2.75% $0 $0 / $2 OpenMore
ANZ Progress Saver
ANZ Progress Saver
Earn a high ongoing interest rate when you meet the minimum monthly deposit. Interest calculated daily, paid monthly. 3.71% 0.01% 3.70% $0 $10 / $10 OpenMore
HSBC Flexi Saver Account
HSBC Flexi Saver Account
A flexible savings account with online and branch access to your funds. Loyalty bonus when you make the minimum monthly deposit. 3.50% 2.50% 1.00% $0 $0 / $0 OpenMore
Easy Street Bonus Saver Account
Easy Street Bonus Saver Account
One of the most competitive bonus rates on the market. 3.93% 0.01% 3.92% $0 $0 / $0 OpenMore
BankSA Maxi Saver
BankSA Maxi Saver
BankSA is offering one of the best* interest rate in the market. 4.05% 2.50% 1.55% $0 $0 / $0 OpenMore
Bank of Melbourne Maxi Saver
Bank of Melbourne Maxi Saver
Enjoy a high ongoing interest rate with no monthly account service fees. 4.05% 2.40% 1.65% $0 $0 / $1 OpenMore

What are online savings accounts?

Online savings accounts are a special savings account you open up with a financial provider online. This type of account is based purely online and you tend to have little interaction with the bank - you manage it all yourself. Online savings accounts are a great way to help you achieve your savings goals as they tend to have higher interest rates due to less overhead costs. Although online savings accounts can be opened by anyone, they are best suited for those who are technologically savvy, people who may have difficulty accessing their local branch and those who want to save on fees.

How do online savings accounts work?

Online savings accounts tend to be fee free as you’re managing your own account without the help of the bank. By reducing your contact with the bank and the work required on their behalf, this leads to lower or no fees. You manage every aspect of your account online, from transferring money into your account, withdrawing and monitoring your savings growth. Online savings accounts encourage saving by having higher interest rates. You may also be eligible for bonus interest if you meet certain requirements. If you have a specific savings goal such as a wedding, new car or first home, online savings accounts can help you get there by not tempting you to touch your money.

It’s important to note that most online savings accounts will need to be linked to your everyday bank account. This acts as a portal where you can transfer money back and forth.

What are the types of online savings accounts available?

  • Bonus interest for a period of time. Some online savings accounts may have bonus interest for a certain period of time, such as during the introductory period. Bonus interest periods typically last a few months and during this time you receive bonus interest or the higher interest rate.
  • Bonus interest for meeting deposit requirements. With some accounts you are required to meet minimum deposit requirements to be eligible for bonus interest or the higher interest rate. This means you must meet the minimum deposit amount. This is usually a minimum deposit per month or a minimum opening deposit.
  • Bonus interest for not making withdrawals. Some accounts reward you with bonus interest for not making any withdrawals or for making minimum withdrawals. With these accounts it’s important not to withdraw or limit withdrawals if you want bonus interest.
  • Bonus interest for both meeting deposit requirements and making no/limited withdrawals each month. You may also receive bonus interest if you meet deposit requirements and make no/limited withdrawals each month. This encourages you to save as you must constantly deposit money into your account and not withdraw.

How to compare these types of accounts

  • Interest. With online savings accounts, one of the most important things to compare is the interest rate. As this is a pure savings account, you need to look for a high interest rate that will assist you in growing your savings. Also compare the bonus interest schemes on offer as these can help boost your savings. Check out what conditions you need to meet to receive bonus interest and compare the rates.
  • Access. Although this is an online account, it’s still important to compare access. Can you bank in any other ways than online? Does the bank they provide customer service for your online account? Also, not all banks offer online savings accounts so it’s also important to note this.
  • Fees. Some online savings accounts don’t have any fees but some still do attract a fee. Compare the monthly service fees of each account. Some accounts may charge you a fee but they may come with more features or service in exchange.
  • Technology. You may also be able to do your banking through an app. Many banks have created apps that allow you to easily manage your online savings account wherever you are on your smartphone. If an app would be helpful to you, make sure you compare this when selecting an online savings account.

Pros and cons of an online savings account

Pros

  • Earn bonus interest. Online savings accounts can allow you to earn bonus interest. This is something that not all savings accounts offer and can really help you increase your savings just by meeting certain conditions. It’s practically free money.
  • Low or no fees. As it’s all online, you can enjoy low or no saving. You have the peace of mind knowing your hard earned savings aren’t going towards paying excessive fees.
  • All online. Being able to manage your account online is a big advantage for some. You don’t have to leave the house and visit your local branch. You can do all your banking when it suits you online.

Cons

  • May have deposit/withdrawal conditions. To get the higher interest rate or earn bonus interest, you may have to meet deposit and withdrawal conditions. If you can’t meet these conditions your savings could suffer as a result.
  • Institution may not offer face-to-face banking. Some online savings accounts are offered by online only banks, meaning if you need to do your banking face-to-face there may not be a convenient option for you.

Things to avoid about online savings accounts

Online savings accounts aren’t for everyone. If you are someone who has an irregular income or needs to tap into your savings often, online savings account may not be right for you and you may be more suited to another type of saving.

Frequently asked questions about online accounts

Are their any age restrictions for online savings accounts?

Some savings accounts do have age restrictions to open up an account. However, there are also some childrens savings accounts available for parents to open up for their children.

What happens if I can’t meet the requirements for bonus interest?

It’s okay if you don’t meet the bonus interest requirements. You will still be eligible for the normal interest rate. Some bonus interest rates are applied monthly so you can always work towards meeting requirements for next month to receive bonus interest.

Can I set up automatic transfers?

Most banks do allow you to set up automatic transfers from your everyday account so you don’t need to worry about regularly making transfers into your account, it will automatically do this on your behalf.

  • Guide to talking about money with friends

    It’s been said that politics and religion are two topics of conversation you should steer clear of during dinner parties. But how about money? Do you mind if I ask you a personal question: How much money have you invested over the past month? Oh, sorry, looks like you don’t want to answer that one. [...]

  • Top Online Savings Accounts

    When you want to open a savings account, you want to make sure you are being offered the best interest rate possible so that you can reach your savings goals. But you also want to make sure your savings accounts are easily manageable. That’s why you will want to look for online savings accounts, as you will always have access to your money either over the phone or with any computer and an Internet connection.

  • Internet Banking: The Benefits and Risks

    There are many benefits that are associated with on-line banking, as well as risks. These risks come in the form of Internet banking security issues. While most benefits outweigh the risks in most financial platforms, let’s see how Internet banking performs.

  • Best Flexible Savings Account

    The best flexible savings account is the one which knows your needs and spending style and flexes with you, rather than resisting your movements. It is also an account which allows you to be flexible, so if you sometimes pay your bills online, and other times you make a payment at the Post Office, a [...]



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26 Responses to Online Savings Accounts Comparison and Application

  1. Default Gravatar
    Jessica | July 31, 2014

    Hi,

    I have a question about SMS and/or email alerts for your online banking products.

    Do you offer email alerts when money has been deposited into my account, and if so, can I set up the alerts so that my sister is also alerted as well as myself?

    • Staff
      Marc | August 1, 2014

      Hi Jessica,
      thanks for the question.

      Could you please clarify which account you’re asking this about? The exact answer will depend on the banking institution and the account.

      Cheers,
      Marc.

  2. Default Gravatar
    Brian | October 31, 2013

    Hi,

    I am looking for the best interest rate for my Self-Managed Superannuation savings. Most Banks only offer special introductory bonuses to individuals or group accounts. Which is the best rate for a super fund – my current bonus period with ING has just expired.

    • Staff
      Shirley | October 31, 2013

      Hi Brian,

      Thanks for your comment.

      Unfortunately, at the moment we don’t compare SMSF savings account.

      Cheers,
      Shirley

  3. Default Gravatar
    Vlad | August 21, 2013

    Regarding bank of Melbourne
    Interest rate offer for 4 month
    Is it from the time of opening an account? Or from the time when I transfer the first amount of money?

    Because I am no mel bank customer I need to open two accounts , do I need to pay any monthly fees?

    • Staff
      Marc | August 21, 2013

      Hello Vlad,
      thanks for the question!

      The bonus interest rate starts from the date your account is opened. There are no monthly fees with the Bank of Melbourne Maxi Saver, but there may be fees depending on what linked transaction account you use.

      For more information about this product check out our review here.

      I hope this helps,
      Marc.

  4. Default Gravatar
    Robyn | July 15, 2013

    Do children under 18 years of age and studying full time have to have a TFN or are they exempt from tax on interest earned?

    • Staff
      Shirley | July 15, 2013

      Hi Robyn,

      Thanks for your comment.

      Yes a TFN is required to be exempt from tax on interest earned.

      Cheers,
      Shirley

  5. Default Gravatar
    Nick | April 29, 2013

    Please tell me the best online savings account
    with good interest rate for couple in 70th year with 2000 P/m Australian Pension which goes on living costs, and 1000 P/m UK Pension that we spend 50% to 70% of. We have 14000 in savings

    Thank you.

  6. Default Gravatar
    Warick | March 11, 2013

    Are all accounts covered by the Australian Government Guarantee Scheme?

    • Staff
      Isaiah | March 12, 2013

      Hi Warwick,
      thanks for your question,

      The Australian Government Guarantee on deposits applies to a wide range of deposits held with ADIs, including:
      savings accounts;
      call accounts;
      term deposits;
      current accounts;
      cheque accounts;
      debit card accounts;
      transactions accounts;
      personal basic account;
      cash management accounts;
      farm management deposits;
      pensioner deeming accounts;
      mortgage offset accounts, either 100 per cent or partial offset, that are separate
      deposit accounts;
      trustee accounts;
      retirement savings accounts; and
      first home saver accounts that are deposit accounts.

      For your interest if you would like to learn more, here’s a link from APRA about the deposit guarantee for ADI’s.

      All the best,
      Isaiah

  7. Default Gravatar
    David | March 11, 2013

    I’ve got just under $50,000 invested with ING but the interest rate has drops from 4% to 3% once the balance goes below $50,000. Is there a better place to put my $40,000+?

    • Staff
      Isaiah | March 12, 2013

      Hi David,
      thanks for your question,

      you may want to consider comparing different high interest savings accounts if you are interested in maximising your interest.

      I have included a link with a video by Fred Schebesta from finder.com.au who shares some helpful insights an tips on high interest savings accounts.

      Click here

      I hope this helps,
      Isaiah

  8. Default Gravatar
    Geoff | February 27, 2013

    How can you ignore Ubank’s online saver? It earns 4.91%. This is higher than the RAMS case, which you so prominently display. But then again you may have WESTPAC bias.

    Cheers

  9. Default Gravatar
    Pujan | January 10, 2013

    I’m from kathmandu, Nepal. I’m 18+ college student. I’m planning about getting international debit card along with online saving account. I’ve zero knowledge in banking. Please help!

  10. Default Gravatar
    jaz | January 9, 2013

    does the introductory interest period mean how long it takes till your account gains interest?
    eg: Bankwest is 6 months, does that mean i wont gain interest on my account until 6 months has passed?

    • Staff
      Adrian | January 10, 2013

      Hi Jaz.

      No, interest on online savings accounts is usually paid monthly, on the first business day of each month. The introductory interest period is the length of time that an extra promotional rate of interest is applied to the account.

      Cheers, Adrian.

  11. Default Gravatar
    Larissa | January 2, 2013

    Whats the difference between maximum and standard variable rates?

    • Staff
      Adrian | January 2, 2013

      Hi Larissa. Thanks for your question. The maximum variable interest rate is a combination of the standard variable interest rate and the bonus variable rate. Standard variable interest rates always apply to the account (although this doesn’t mean that that standard variable rate can’t be reduced) whereby a bonus variable interest rate applies usually by satisfying some sort of condition (such as a minimum deposit and no withdrawals, or may just be an introductory rate for new customers which ends after a certain number of months).
      I hope this explanation makes sense.

  12. Default Gravatar
    pauline | December 4, 2012

    I am interested to find out if there is a savings account that does not have internet banking as I want a pass book account so I have to go in branch to access my account

    • Staff
      Adrian | December 5, 2012

      Hi Pauline. If you are asking about the iPhone banking service, it is not yet in Australia.
      Is this what you meant?

  13. Default Gravatar
    Karin | December 1, 2012

    My online Bank has reduced interest rates to under 5% , can I go to anther bank with higher interest rates for 6 month and then change again to whoever has the highest rate ?

    • Staff
      Adrian | December 3, 2012

      Hi Karin. Switching online savings accounts to chase a higher interest rate is a pretty common practice. You should be able to switch from and to most online savings accounts without fees or problems.
      All the best.

  14. Default Gravatar
    Shane | October 12, 2012

    Is the “RAMS Online Saver” account available to SMSF’s?

    • Staff
      Adrian | October 16, 2012

      Hi Shane, it isn’t. You will have to try the business product offers with most institutions. Rabo Direct, however, has the same offer for individual accounts as it does for SMSF’s.
      Thanks for your question.

Top High Interest Savings Accounts*

All of these accounts are FREE to open and require no minimum deposit. They all have easy internet banking access with no transaction fees.

Rates last updated August 2nd, 2014.
Maximum Variable Rate p.a. Standard Variable Rate p.a. Bonus Interest p.a. Fees Min Bal / Min Deposit
Bankwest TeleNet Saver
Bankwest TeleNet Saver
No Fees. No minimum monthly deposit. For balances up to $5,000,000. Earn a high 4.09% p.a. variable rate for 4 months. 4.09% 2.70% 1.39% $0 $0 / $1 OpenMore
ING DIRECT Savings Maximiser
ING DIRECT Savings Maximiser
A high interest savings account with no account keeping fees. Earn a up to 4.00% p.a. variable rate for 4 months. 4.00% 2.75% 1.25% $0 $0 / $0 OpenMore
HSBC Serious Saver
HSBC Serious Saver
A high interest savings account offer with ongoing variable bonus every month you don't make a withdrawal. 4.00% 2.90% 1.10% $0 $0 / $0 OpenMore
ANZ Progress Saver
ANZ Progress Saver
Earn bonus interest calculated daily and paid monthly when you make a deposit of $10 or more in a month and make no withdrawals. 3.71% 0.01% 3.70% $0 $10 / $10 OpenMore
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