Westpac increased their 12 month term deposit rate to 6.8% this morning, which is much higher than any other Australian bank (Citibank 6%, BankWest 5.8%).
They also offer paying interest monthly, also to another institution, which is rarely seen on 12 month term deposits.
This is a good 1.34% higher than the highest paying at call rate (UBank) and 12 months is a good term, so I think it's a deal.
Currently the UBank 12 month term deposit is 5.71%.
Yeah, I know. They're uncompetitive now. Even Citibank are offering a higher, at call, promotional rate of 5.5%
Currently offering a variable rate of 5.25% p.a.1 on the portion of your balance from $10,000 to $1million. The first $10,000 does not earn interest.
Read the small print.
You're looking at the wrong account.
Nevertheless repeatedly switching for an extra 0.1% or 0.2% might be doing one more harm than good. For example, for someone saving for a loan wanting to use their consistent savings record to bolster their application, it's probably not going to help if you present a bundle of statements from diffrent banks showing you switch constantly.
YOU get your facts straight
I was talking about the Citibank Online Saver.
Uncompetitive because one bank beat them by 0.04%? Turn it up…
On the term deposit front: 1.09% lower in fact.
word to the wise : no point locking at that rate for 12 months
rate rise eminent today .. and another next year
This doesn't necessarily mean term deposit rates will increase in line with the RBA's rates.
historically they have … and will continue to
If banks lend money .. they also need deposits !
i think the relevant point here though is the extent to which the very likely future rate rises have already been factored in to this 6.8% rate - so unless rates go up MORE than expected (not just go up), the term deposit rates won't be likely to change that much
Suncorp Bank currently offers a rate guaranteed of 0.25% higher than any offered by the big four banks. So, you should be able to get 7.05% with Suncorp.
Yes, your're right. It was hard to find but it is in writing here: http://www.armadaleshoppingcity.com.au/images/newsandoffers/…
Only valid until December 12th. I bet Suncorp are keeping very quiet, I can't see anything on their website about it!
Both of you are legends….thanks to you I just went to Suncorp and did precicely what you suggested. :)
They didn't have that 0.25% ad in the branch…but i did see it in central station on a billboard…so it's not like they're hiding it THAT much.
Sigh, and I just moved to Ubank… Oh well, back to Citibank again!
http://www.citibank.com.au/AUGCB/APPS/portal/loadPage.do?pat…
A great introductory rate of 5.50% p.a.1 for the first 6 months of your account opening. At the end of 6 months you'll receive our standard variable interest rate, currently 4.25% p.a.1
If you've had your Citibank account for more than 6 months, you might only get 4.25% at Citibank.
If you've had your Citibank account for less than 6 months, then maybe the offer applies to you (not sure if it's an offer for new accounts from the time this promotion starts … I haven't been through the terms and conditions)
I'm pretty sure you can bargain for the introductory rate given that you're an existing customer. I've been able to do it with other banks.
If you can do that for Citibank, I'd be very interested :) :) :) especially if you have any tips.
(The people I've spoken with from them, weren't too flexible in the past)
…
Have you gotten ING to flex their promotions? usually the bonus rate for them is on new money only.
@SomeGuyOnOzB: what I've done with ING… is once their promotion is over - I drain my account … and put the cash somewhere else that is paying a higher rate of interest… then when ING decides to offer a higher variable rate again, the benchmark set for me is quite low … (currently, mine is about $2.85) :)
I think they are being very tricky when they only offer the bonus rate for new money.
@SomeGuyOnOzB: Simple. I can guarantee that Netbank (Commonwealth Bank) will do it.
Just say that you're a loyal customer and that there are other better deals in the market than what they're offering. They will then, without doubt, bump you up on the introductory rate to maintain you as their customer. Works for me all the time :D Annoying thing is when the introductory rate period is over and it falls down to the standard rate, I have to call back to bump it back up to the "new" introductory rate.
@SomeGuyOnOzB: With ANZ you simply open a new account every time they bump their interest rate.
You can do it online and you don't even need to speak to them.
I have about 5 ANZ online saver accounts, all with different promo rates and timeframes.
Doesn't matter because there are no fees.
The only reference I can see about an interest rate of 6.80% is for a 36 month term rate. Otherwise it is 5% and 5.20% for a 12 month term. Am I missing something here?
Check the Westpac website, 12 months is 6.80%
12 < 24 months 6.80%
Check the link again
Does this apply to ALL amounts deposited or only the balance over $5,000?
http://westpac.com.au/personal-banking/bank-accounts/savings… seem to suggest that rate is only earned on amounts over $5,000, but when you put "$5000" into their rate calculator you get $340 interest p.a.
Very confusing.
The rate applies to the full amount, but the minimum term deposit is $5000 which is due to the paperwork involved.
If you have only $5000, it makes very little difference which bank you chose for a term deposit (1% of %5000 is $50, over a year).
great deal
RBA has lifted rate again today. So think carefully when you want to lock in for 12 months. RBA would like to keep rate at 5-6% from mid next year. So if that is the case then the rate will go up to 8%+. But seems like this is still a great deal.
I think Westpac already factored this in as they only just updated it. Quite a good deal. even if interest rates go up to 7% this time next year i think you would probably come out ahead.
The only thing I dont like from term deposit is that they pay you on maturity so you lose the advantage of compound interest and if the interest rises during the year, you're rate is already locked in. PLUS, you can't really add money during your 12 months term.
uBank pays your interest monthly and you can add money to it as interest are calculated daily - just hoping they can boost up their interest rate to beat this! :)
6.6% if you want it paid monthly (westpac, check the bottom of the page in the original link). I guess compounding over 12 months brings it close to the 6.8%.
I guess that's the same. (1+ 6%/12)^12 = 1.0055^12 = 1.06803355947. So it comes to 6.8034%.
Paid monthly does not mean compounding.
Paid monthly means paid monthly into a separate account, not re-invested.
dammit i just put some money in 12 months short term deposit in citibank @ 6% p.a
ah well, signs of good things to comes one hopes !
is it worth pulling it out and reinvesting it? If you only just opened the other one …
People have a range of places they can invest their money. If they want a term deposit, especially with a big 4 bank, then this is a bargain compared to the others.
It might be good interest rate, but it's not a "bargain".
better interest rate = better interest = more $$ in your pocket - why is this not a bargain?
The point is, when people vote negative, for the voter to say why it is not a bargain or what problem there is with the posting.
You haven't said yet, why you believe it is not a bargain.
If you look at our site - we talk about "deals" not just "bargains" eg Top Deals New Deals
A bargain as one web source puts it "A thing of good value or an attractive deal"
And one persons Bargain isnt always another
And a Bargain today might not be a Bargain tomorrow
See
http://www.ozbargain.com.au/node/19666
http://www.ozbargain.com.au/node/19641
guess they expected the rate rise today!
And here's the flipside to this deal - Westpac takes today's rates rise and doubles it for their mortgage customers - http://www.theage.com.au/business/westpac-rates-shock-200912…
lol
is it worth it?
really depends on your own lifestyle and financial goals. At today's rates - it looks like a good deal. But the other banks might match the rate to compete for depositor's funds.
You also need to factor in if you can lock away the money for 12 months / or how much of your money you want to lock away.
Plus it pays to know what happens if you pull your money out early.
WESTPACK and their catchy 12 months term trick LOL
I wouldn't trust it so hastily, I give half negative vote that is if i could LOL
I dont care how good this rate is. They sprout this 'generous' deal on the same day their 'borrowing costs' require them to raise interest rates above the RBA. The exact same excuses given for why the rates never dropped in line with the RBA official rate.
Typical bank.
As far as I can see, they have increased it for both deposites and loans, in doing this, they would attract local money that they can lend, rather than borrowing overseas!
People who have surplus funds to invest don't care what the lending rates are so its not even relevant. In fact the higher the better because it will mean higher return for them.
ooh…take THAT UBank! i hope this starts a bank war ;)
I'm voting negative purely because I have a home loan with Westpac :)
Sorry :P
Then by your own admission you are not voting on this as a bargain which is what voting is for - this is NOT a social site, it for bargains please keep on track.
While I understand your personal frustration this is NOT the place for you to do that
St.George offer the same rate as a term deposit for 12 months if you wanna keep your bank accounts together.
Dont high interest accounts normally give the best rate these days?
Well finally one of the banks is being realistic with TD rates as with the strong possibility of rate rises in the next year, and getting 5.5% at call then TD's have been looking like a poor investment with locked in returns.
But jumping in today just because Westpac offers finally an attractive rate compared to the others is a little silly as it is fixed for 12 months AND that means fixed. So if Xbank comes and offers a better rate in a few weeks you cant switch like you can with at call deposits. As indicated above St George is now offering the same (Yes they are a Westpac subsidiary) - you do need to search their site to get this info
One OP said they think this maybe better even if rates rise. Dont think, do some calculations and wait a little to see what other banks do. BUT then again maybe its better to let everyone jump to this, then it drains the other banks and they HAVE to react, which is better for those of us who wait.
EDIT 1 day later - Its on as predicted see
http://www.ozbargain.com.au/node/19666
http://www.ozbargain.com.au/node/19641
I'll give Westpac an -ve for raising interest rates so much yesterday !!!
Nab is also offering the same rate 6.80% for 12 months
Thanks for the hint with SunCorp matching the big 4. They gave me 7.05%. I opened the account over the phone, no hassle at all. Still positive vote for this bargain, since it alerted me to the rise in TD rates.
All the people who worry about locking in with rising rates: Even if cash rates go to 7%, I still have the benefit of getting that rate from today. For a cash account to do better on average than this TD its rates would have to rise from 5.5 to 8.5% in the next 12 months. That is highly unlikely.
Teri - just be careful - your assumptions will be affected by the timing of those rate increases - if they happen quickly then your return will not be as good, so really its impossible to tell until after the event - you know the hindsight rule always applies.
But the positive vote is a nice thank you for the poster
Wastebag gets a negative for me for that 45 basis points hike.
yeah? well why'd you get a loan from "wastebag" in the first place?
Obviously, cause you thought they were giving you the best deal at that time…
So long as loan rate hikes are accompanied by equivalent deposit rates, then the bank isn't profiteering.
Great! got 7.05% for my Term Deposit this morning with Suncorp. CBA was unable to match this.
Thanks.
its not bad is it? I've done the same :-)
Me too :)
but you can't do that anymore with suncorp…their offer's expired.
UBank need to act quick else people will move!