Information about some of the best* rates for a 90 day term deposit or 3 month term deposit. Compare and apply online today.
Term deposits are designed so that you receive a higher interest rate the longer you choose to invest your money for. However, you can choose to invest your funds in a term deposit for as little as three months and still earn a significant amount of interest in the process.
These types of term deposits could be suitable if you still need some level of liquidity within your assets, or you've never applied for a term deposit before and want to test the waters as to how it could affect your financial situation. It's also important to check when the interest is calculated and paid. The more frequent the interest is paid or accunulate, the more you will earn.
While the interest earned is an important factor in the decision making process, when choosing a three month term deposit, make sure you compare the features of your account. Consider the following:
- Decide how involved you want to be in your investment.
If you want to set and forget your investment for three months, then choose an account which doesn't need your input, but which simply invests your money, activates your account and earns you interest. Some term deposit accounts will allow you to make changes to how your interest is paid, or what you will do with your investment at the end of the term, during the term. Others will automatically re-invest for you at the end of the term.
- How do you access the account?
Make sure you are comfortable with the way you access and activate your term deposit account because if it is hard to use, then is it really worth the extra interest? If you don't want to open a new bank account, compare the term deposit options with your current provider, or if you prefer to do all your banking online, choose a term deposit account which gives you full internet banking access to your funds and term deposit details.
- Then choose the best interest rate*.
Don't automatically choose the three month term deposit account with the best interest rate* because if the other account features don't suit you, then you are not making the right choice, regardless of how much interest you can earn. If the account is hard to use, doesn't pay returns when you want it to or doesn't take your deposit amount, then it's not the best account*.
A term deposit doesn't have to be a long term fixed investment because you can choose just about any investment term which suits you and there are often very competitive specials on short term investments such as three month term deposit accounts. A three month fixed investment may sound like a long time, but with a term deposit account you don't need to manage at all, maturity will arrive before you know it. Here is how to choose the best three month term deposit account*, and make the most of your investment.
Compare personal term deposit interest ratesRates last updated November 28th, 2014
Compare term deposits for businessesRates last updated November 28th, 2014
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What can I use a 3 month term deposit for?
Three months might not sound like a long time when it comes to investments but it can be long enough to see results in a term deposit, as well as help you achieve other financial or savings goals by keeping your funds safe.
Uses of a three month term deposit:
- To keep your savings account balance safe until you need it.
If you have been making regular contributions to a high interest savings account to achieve a goal such as an important purchase, a big holiday or a big wedding, then you may have reached that goal before the date of the big event arrives. To remove all temptation and to keep your savings safe from being spent you can invest your balance in a term deposit for as little as three months until you need it. Your funds will continue to earn interest but you won't be able to access them, where you are able to transfer your funds from a savings account.
- You have come into some money.
If you have been given an inheritance, gotten a payout from leaving your job or maybe even won some money then you can invest those funds in a three month term deposit until you decide what to do with them. Three months is a good amount of time for you to think about how you want to spend your money, especially if you have just left a job and gotten a payout, you may want to wait for things to settle down and become clearer before making any big financial decisions. Until you're ready to make a decision about your funds, they can remain safely in a term deposit for three months, and they'll be earning interest in that time too.
- As a gift.
If your child is finishing school or university and you have some savings which you have been adding to for their education or to help them start a life of their own, you may want to open a three month term deposit as motivation for them. Telling your child about the term deposit and even putting it in their name can motivate them to achieve higher grades or study harder until the end of the year when the funds in their term deposit will be available. The funds will also keep earning interest during their three month term, after which your child may even decide to reinvest the money in another term, or withdraw it for their studies, or a deposit on a house or car.
How to make the most of a 90 day term deposit
Just because the really high interest rates are offered on the longer terms, it doesn't mean you can't see attractive returns from a three month term deposit with a little bit of careful planning. How to maximise the returns on term deposits for three months:
- Compare the interest rates on term deposits for three months.
Not all banks and financial institutions offer the same interest rates on the same terms, so once you know that you are going to invest for three months, you can compare the term deposits on these terms. Each bank has different priorities for its customers and can offer different deals so the bank with the best 12 month term deposit interest rate* is not necessarily the one which will have the best three month rate.
- Invest the most you can afford.
Term deposit providers often offer higher interest rates on higher amounts, even if you are investing for just three months it is worth negotiating with the bank on whether they can offer you a better deal for a bigger investment. Plus, because you are investing for just three months you can afford to channel more of your funds into your term deposit because you will have access to them again soon, where you would need to keep some funds in reserve if you were locking them away for several years.
A term deposit requires you to lock your money away where you can't touch it, but where it's earning you interest. However, don't worry that you're going to be cash strapped because of your investment because you can choose a term deposit for as little as three months, and still get a great return on your investment.
How to maximise the return on a 3 month term deposit
- Compare the interest rates for three month term deposits across Australian banks and financial institutions.
- Don't take up the option, if it's offered, to have your returns paid monthly.
- Deposit as much of an investment as you can afford.
- Don't be tempted to access the funds before it matures, as there is a penalty for it.
How to do I compare term deposits?
The rates set on term deposit accounts are affected by the terms you choose, and the longer the term, the higher the rate. This is partially to encourage long term investments so the banks can enjoy the security of personal deposits in their deposit reserves, and partially to take into account movements in official interest rates over the term of your investment. Therefore, when comparing rates on short, three month terms:
- Shop around for the best deals and don't be afraid of promotions.
Securing a number of short term investments is good for the banks too and many Australian term deposit providers will run special rates and promotions on their three month investments. Where you may need to be wary of promotional interest rates with other financial products, with a term deposit account, your rate is fixed so even though the rate on offer is promotional, once you open the term deposit account, that rate is yours until maturity.
- Compare rates based on your investment amount.
The amount you invest in a three month term deposit can affect the rate your investment earns. Typically the larger the investment, the higher the interest rate, so rather than wasting time comparing interest rates on products you can afford to invest in, make comparisons of three month term deposit rates based on your investment amount.
- Remember you are looking at a per annum rate.
When you are comparing the interest returns you can make on a three month term deposit, make sure you use the term deposit comparison calculator above. This way you will get an accurate idea of how much interest you will earn over a three month period, because the interest rates advertised on all term deposit accounts are for a full year of investment. Therefore, a three month term deposit with a 4% p.a. interest rate is only earning you a quarter of that interest rate because you have invested for a quarter of the year.
High interest saving accounts
You may also be interested in a high interest savings account instead if you need more liquidity.Rates last updated November 28th, 2014