Term deposits are a secure way to store your money, and the Australian government guarantees them. You can earn more if you invest in other places, such as properties or stocks, but you're at a greater risk of losing it. Search and compare government-guaranteed term deposits and calculate interest rates, refunds, fees and more to find the right one for your needs.Unlike term deposits, which have a fixed interest rate, savings accounts generally have a variable interest rate, so they will depend on market conditions. A term deposit allows you to keep a lump sum for a certain period of time with a fixed interest rate, so you know exactly how much you will get back when it matures.
You can usually choose to have the interest paid monthly, semi-annually, annually, or at the end of the term (“at maturity”).If interest rates fall, you'll still get the rate you selected over the term. Products that offer returns two or three percentage points higher than a term deposit come with significantly higher risks. With term deposits, your interest rate is locked in, so even if the market falls, your rate remains the same and you know how much you will receive when it matures. There are usually no fees charged unless you withdraw the funds before the term ends.Some accounts may require a certain amount to be deposited each month to qualify for an additional interest rate so that your savings can grow.
And if interest rates on savings accounts are falling, a term deposit allows you to set a rate for a specific term. However, with a term deposit, you cannot make any additional contribution beyond the initial lump sum; once you have established your term deposit, you cannot make any further changes to it until it reaches maturity.It's important to manage your term deposit closer to its maturity date and consider your options. Some term deposits may be automatically renewed at the current rate for that period; this rate may be higher or lower depending on current interest rates. If you need to close your deposit early, the full interest you would have earned up to that point in the term will not be paid to you and you will have to give 31 days notice unless you urgently need access to your money.Compare interest rates on term deposits and learn more about how they can help increase your wealth.
