High Interest Term Deposit

All term deposits will earn you a high interest rate, you are being rewarded by the bank for letting them keep your money for a little while. However, there are ways to maximise the interest earned on your term deposit investment and you can do it with some simple decisions as you compare term deposit accounts.

How a Term Deposit Works

A term deposit allows you to invest a certain amount of money, usually any amount you are comfortable with, for a set period of time, during which time your money is earning interest which is usually paid at the end of the term, also known as maturity.

What does a term deposit do:

• From the moment you open a term deposit account you know how much interest you will be earning and what your return will be at maturity. This guaranteed nature of a term deposit is what makes them so popular because no matter what else is going on with shares, the property market or interest rates, you have already chosen the interest you’re going to earn, and it’s locked in.
• Allows you to invest as much or as little as you like. Some term deposits will require a minimum balance while others will let you invest any amount you choose. Depositing your investment is often as easy as an electronic transfer from your everyday account to your term deposit account. The deposit of your investment activates your term deposit account and you can start earning interest within days.
• It doesn’t ask you to do anything else. Once you have deposited your initial investment there is nothing else you need to do to your term deposit. It will work hard for you, earning interest and paying you returns if you have asked it to, and you don’t have to make endless calls to your financial advisor, or wait with baited breath for the next interest rate announcement.
• It can supplement your income or give you a boost. When you open your term deposit, and in some cases after the term has started, you can choose whether you want your interest to be paid to you regularly throughout the term of your investment, or whether you want to receive all the interest at maturity. In this way you can get regular payments from your investment, or leave the interest to accrue, and use it for a holiday, a home theatre system, a new car, or whatever savings goals you have.

Term Deposit	1 Month	3 Month	4 Month	6 Month	12 Month	24 Month	36 Month	60 Month	Min Deposit
St. George Term Depost			5.40%	7 months – 6.00%	6.00%	6.00%	6.50%	6.75%	$5000

How to Earn High Interest in a Term Deposit

While a term deposit will generally earn you high interest, higher than an ordinary high interest savings account, and much higher than an everyday transaction account, there are ways you can ensure your investment earns you the maximum amount of interest.

How to maximise the interest on your term deposit:

• A longer term will earn you higher interest. The bank is rewarding you with higher interest rates on term deposits because you are locking your money away with them, and the banks use the money you have invested to invest in shares, and the money market, and that is one of the banks’ main sources of income. Therefore, the banks want you to lend your money to them for as long as possible, and so encourage you to invest in a longer term deposit, by offering the highest interest rates on the longest terms.
• Have interest paid at maturity. There are often different rates for term deposits which are paid at maturity, and those which pay interest monthly, quarterly, six monthly or yearly. Therefore, to earn the highest interest rate on your term deposit work out whether you can do without the regular interest payments in your budget.
• Shop around because not all banks are the same. Banks may seem to offer all the same products with all the same features, but when you compare closely you will see that each bank tailors each financial product to a different person with a different need. As a result it is possible to find a higher interest rate on your term deposit just by shopping around and comparing rates. This also allows you to take advantage of promotional rates from banks which are having a special, or those promoting a new product, for example Citibank have launched a term deposit account for the first time and are offering the highest term deposit rate in Australia of 5.50%. You also don’t have to worry that a promotional period will end because as long as you open your term deposit before the promotion expires, you’ll earn that higher rate for the entire term.

You can compare the interest rates of all term deposit accounts in Australia at Savings Account Finder, as well as read in depth reviews about new, promotional or unique investment products which might suit you.