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A high interest savings account can certainly accelerate budding property buyers’ deposits yet new data shows Australians are largely ignoring better returns.
According to data released by APRA on Friday, 72.7 per cent of all retail deposits were held by the big four banks in June this year. This is despite many second tier banks and online specialists offering much more attractive deposit rates.
The Commonwealth bank, for example, held 27.7 per cent of all retail deposits in June followed closely by Westpac at 20.8 per cent while ING DIRECT, a pioneer in high interest online savings accounts, held just 3.2 per cent of deposits.
CoreData-brandmanagement principal Andrew Inwood said the figures demonstrated that many Australians were not aware that their deposits were equally safe, and in many cases better off, with alternative institutions.
“The result remains that Australians continue to hold their deposit with one of the big four even though they could receive an increased rate of return with a smaller ADI, with the same level of security as a big four bank,” he said.
For further details on how high interest savings accounts can accelerate your home loan deposit look out for the September issue of Smart property Investment, out soon.
Interest is the amount of money charged by a lender or financial institution for a loan, which is calculated as the percentage of the principal amount paid over the loan term.