UBank has just increased its online savings account rate to 4.91%. $200 automatic deposit per month required.
Previous UBank rate was 4.66% and now the savings account rate is much higher than locking in money in a term deposit for up to 1 year.
Ubank Savings Account 4.91% - No Fees, $200 Deposit/Month Required
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Make a profit on the spread with fixed rate home loan interest rate of 4.99%?
Only if you don't pay any income tax on the interest earned. Most people have to.
But if you have an investment property with extra payment facility fixed loan, what delfredo says makes sense. If you have additional amount paid on your fixed loan, you might want to take that out of the mortgage account and put it in the ME Bank saving account in this situation.
Since, both accounts are taxed at your marginal rate, it make sense to do what delfredo says in the above situation.
This is correct if your IP is negatively geared, you will still pay tax on any interest accrued though at 48%, if the IP is positive geared then put it on the home loan to reduce interest paid (and not pay tax on it accordingly)
That's Me!!
Love living over here on Norfolk Island - No Income Tax!! :DWrong.
If it's an investment property, it does not matter whether it's positively or negatively geared, any $ earned will be taxed whether it is coming from the property or savings account. You need to maximize the amount you can earn as a whole, and not on an individual asset class.wrong against - IMHO. Investment property loans interest is only deductible when you're using it for exactly that purpose. Ripping money out of the loan and plonking it into the 5.1% savings account is going to result in the 5.1% interest taxed at your marginal rates. at 30% tax that 5.1% x 0.70 = 3.57% effective interest rate.
You would pay interest at 4.9% of your home loan and that would not be deductible. so your losing 1.4% basically.
Get proper tax/accountant advice. Above does not constitute actual or correct advice, but is my understanding of it all.
-Accountant.
Very wrong. Is this the state of accountancy in this country? I hope you did not advice this to your paying coustomers. Your opinion is crap.
Ex:
Investment property with 200k loan. Put 200k in offset account to offset the loan. No interest paid.Take out 200k and put it in the savings account. 5.1% interst. SO that is 10.2k per year?
Now the investment loan is at say 5%. The -ve gearing will be -10k.
You are is $0.2k ahead at tax time by putting your money in the savings account.
Agreed. There are better rates elsewhere.
No Deal.This is definitely the pick at the moment…HOWEVER it is 3.5% plus 1.6% for 12 months. NOT 5.1% for 12 months. The 3.5% is variable and will almost certainly go down with official interest rates. UBANK could easily overtake ME bank again.
My UBank used to be 5.61 percent or so a year ago .. now look where it's at :( 5.11 + 0.50 for $200/mo
This is interesting. My savings maximiser bonus has just run out with INGDirect so I was about to open a MEBank account. However, I have a Ubank account sitting there. For the sake of 0.19%, I might just go back to Ubank. However, after 31st March when the offer with MEBank ends, they may drop their rates again…
Same position as me, my savings maximiser 5.10% bonus rate just ran out too (signed up with that last $50 bonus offer).
I think I'll move my money back to UBank since it's there anyway and I've kept the ASP continuous throughout so don't need to wait a month to get the bonus rate again.
Keep in mind that if you stopped your ASP, you will need to wait for the month after qualifying for the bonus rate again.
what about if you edit (reduce or up) your asp?
for example today i reduce my asp from $500 to $400
will it affect the bonus interest whatsoever?No it won't affect you.
As long as you have an ASP set up to deposit at least $200 per month then you will keep getting the bonus rate.There's more info here
https://www.ubank.com.au/ubank/web/products/savings-account/…I decreased my ASP to the minimum while I was using ING's Saving Maximiser just to keep the bonus rate going.
Could I set one up today for $200 and then I'll get the bonus next month, or will I get the bonus 1 month from today?
From the link I posted above:
The Savings Bonus accrues the month after setting up an ASP
For example, if you set up your plan during January, you will begin to earn your Bonus Interest from the 1st of February. The Bonus Interest you earn in February will show in your account on the 1st of March.
Thanks for clearing that up, I really should click links!
If savings rates are moving up…you know what that means…Home loan rates are on the up going forward.
No? What does it mean? Are you for reals?
Wonder why they've done this considering all the hum-drum about an imminent RBA cash rate drop.
Nevertheless, its convinced me to move the majority of the remainder of my BankWest savings into my UBank account.
They've probably had their deposit book running off for last few months due to competition and money moving out of cash. These things move in cycles due to changes in management focus. One month it's all about volume/market share and then the next it's all about margin.
how about old customer? also got increased?
coool bananas… almost move to ME but 0.19% is not much, i will stay (since my homeloan already with ubank)Why are you splitting your money when you have a homeloan? assuming its not for an IP you should be aiming to put it all onto the homeloan with the availability of redraw to reduce the amount of interest you pay each month (which will be more then you will earn in interest from any savings account, and you do not pay tax on it)
Yes, everyone gets the higher interest rate. That's the nice thing about UBank unlike say, ING Direct or Rabo Direct. Everyone benefits and not just brand new customers.
Terrific! Was just considering a switch to somewhere with a welcome bonus but this is just great :)
The cost of storing those banknotes is about 3 to 4% of their total value per year due to inflation.
Cayman Islands and Switzerland
Just sayin
If I believed you I would give you a negative vote like the other 11 people (at time of posting).
Citibank has 5% interest but only for the first 4 months and then it goes down to 3.5%. Ubank seems like a much better offer. Thanks.
Me bank is the best offer at the moment.
Nobody should be opening a new ubank account because of this deal.
Have you guys paid off all your home loans ?
You can always get a better rate than this in your home loans with offset account. Why have a savings account when you can put it in the home loan usually at 5 + % and not have to worry about declaring interest income in your tax return.
Even if you have paid it off there are better rates with me bank …
Why are people +ing this deal.
you raise a good point, but try living in overrated/overpriced Perth where the average person would struggle to find a dump you could barely afford to take out a home loan on ;)
personally, i wouldn't plus or neg this.
my mum had an account with citibank. worst experience ever. they mistakenly charged her $10 when she wanted to transfer all her money out of there and it took almost 2 weeks and several angry phone calls before she got her money back.
and i've had nothing but negative experiences with them trying to cash a cash cheque; would never want anything to do with citibank again.
U bank was the undisputed leader until mid last year, since then they've been slipping.
Do people just open an account with USaver and transfer money over from their current institution? Then when rates go bad, transfer back? I.e. the average person is connected to more than one banking company? I'm clueless with banking. I think I've been on 4.0%-4.5% with NAB Saver from years ago.
yes, i've opened quite a few bank accounts in the past few years.
no harm in chasing the best rate you can get.It costs nothing but a little time to open a UBank account. Yes, in the past I have opened multiple online accounts and moved money between them to take advantage of higher rates. There's nothing stopping you doing so. UBank's $200/month deposit requirements are pretty generous too. You can immediately withdraw the money back again.
pftt, mebank is much better at 5.1% http://www.mebank.com.au/personal/bank-accounts/online-savin…
money at call with a linked transaction account. use at atm, eftpos etc
no monthly fees
pay anyone
no automatic savings plan nonsense required
introductory period for 12 months if you sign up before 31-mar-2013
of course anything can happen over the next 12 months but at the moment mebank rocks!
No deal. There are better offers elsewhere.
A small rate rise that is still not competitive.
ME Bank? Never heard of them. Seems like people just chase the highest interest rate no-name pop up bank only to find the interest rate drops in line with competitors a few months later.
Bracing for the downvotes with this opinion..
wasn't that long ago that nobody heard of UBank either. or RaboDirect…
and what's wrong with chasing the highest interest rate?
even if it is an introductory offer for just for a few months, you still stand to gain more interest.is it really worth the hassle of changing banks every few months? I remember a thread here recently where someone did the calculations over a range of balances, and it certainly wasn't.
Yes it is.
for me, it's not a hassle. most banks have very quick and easy sign-up procedures.
it's no different than, say, shopping around for the best bargain.
ME Bank? Never heard of them.
i saw this when i logged in today:
"ME Bank has been awarded 9 gold medals, including Bank of the Year and Lender of the Year, in the 2013 Australian Home Loan Awards."
https://www.mebank.com.au/about-us/news-press/customers-judg…
NOT A BARGAIN.
ubank used to be good, but they screwed all of their loyal customers by reducing their deposit rates by significantly more than the RBA reduced the cash rate (they dropped 1.05% when the RBA had only dropped 0.5%)
they also had a promised to beat their competitors rates ("UBank USaver rate assurance"). they broke this promise. UBank and the NAB are just blood sucking fat cat liars.
get 5.1% from ME Bank without the $200 deposit per month requirement.
They did drop it by a lot….but they also kept it around the 6% mark for a lot longer than the other banks did.
Agree. Rang Ubank yesterday and they would not match ME. Already have an ME online saver but have applied for an Everyday transaction account. Website says there are delays due to the volume of new accounts being opening. Will be shifting the money once Everyday account is opened. Even 0.19% makes a difference.
if I'm not wrong, its ~$8/mth for 50k
Which is an extra $100 for the 12 months of the bonus offer (assuming the margin between the two banks stays the same).
For many people (even those with $50k saved), going through the simple process of opening a bank account is worth it for a free $100.
Heck I have opened bank accounts in the past (eg NAB, ING) to get a bonus instant $50.
Does .19% really make that much difference? Its about $10 a year on a $5000 deposit.
Many people get caught up with getting the smallest difference in rate and have very little deposited that it makes very little difference. I have also seen people sign upto high interest accounts that are not practical, such as ones that are limited to one nominated account, and this can be a big oportunity cost having to move funds in and out of 0% bank accounts.
There maybe smarter ways of increasing savings etc such as getting paid into a high interest bank account and saving in other areas such as bank fees and wise spending, doing overtime at work etc.
Ubank have a very flexible account, many other high interest accounts do not have these features and this can make a big difference.
ME Bank's online savings account is arguably more flexible and accessible than UBank's, as you can link it to a transaction account with MEBank and be able to get money out instantly. Also no mucking around with an ASP.
BankWest is offering 5.50 - .59 better than UBank
Choice has a nice free table:
http://betterbanking.choice.com.au/ditch-and-switch
it lists all the finicky conditions for bonus rates.MeBank is about the best.
again, only for new customers, called bankwest today and they wouldnt give me the intro rate again.
so ive moved almost all my funds over to UBank.
UBank deserves our loyalty because they are the only bank that consistently offer 4+% rates, not just 'intro' or 'temporary' rates that cause you to shuffle money all over the place when they start and end. for me, this convenience of 'set and forget' is well worth the ~0.2% hit (seriously, you need to have cash savings well into the 6 figures for this rate difference to make any serious impact, and if you have that kind of money, you shouldnt just be stuffing it in your digital mattress).
i dont have a bankwest, but i simply cant be bothered starting up new accounts again for a few basis points more. ubank is CONSISTANTLY offering more than the rest. ING used to be, but i've moved away from them permanently. I still use their paypass thou, hehe. but not savings.
Where is that bankwest 5.5% link? I cant find on bankwest website anywhere. The most is 4.80%.
I never have bankwest acc
The BankWest 5.5% product's fine-print says "Must link to a transaction account with this provider. Must deposit between $50 and $500 per month with no withdrawals. Balance transfered into linked account after 1 year."
The no withdrawals part is what keeps me in ubank instead of switching to ME. At Ubank I can make as many withdrawals in the month as I like and still keep the high interest rate.
5.50% p.a refers to Bankwest's Regular Saver account.
This product is no longer sold to new customers:
http://www.bankwest.com.au/personal/savings-term-deposits/ch…
Knowing UBank, the rate will drop to 3.91% in a months time.
No chance.
from the transaction history of my emptied-out ubank account….
18/12/2012 PLEASE NOTE INTEREST RATE EFFECTIVE FROM 18-Dec-2012 IS : 3.96 % P.A..
21/11/2012 PLEASE NOTE INTEREST RATE EFFECTIVE FROM 21-Nov-2012 IS : 4.21 % P.A..
24/10/2012 PLEASE NOTE INTEREST RATE EFFECTIVE FROM 24-Oct-2012 IS : 4.46 % P.A..
12/10/2012 PLEASE NOTE INTEREST RATE EFFECTIVE FROM 12-Oct-2012 IS : 4.76 % P.A..
10/07/2012 PLEASE NOTE THE CURRENT INTEREST RATE IS: 5.01% P.A…Indeed…..when the RBA lowers the cash rate, which is almost certainly going to happen.
i have a timeshare scheme you may like to inve$t in ;)
Sounds good.
Done with Ubank. If they're not loyal to their customers then why should customers be loyal to them. Customers of old will know what I'm talking about.
Plus they still cannot fix their crappy website.
Never could believe that a website could take a massive step backwards :(
its the pits
Far out….interest rates are going down and you expect to be able to loan your money to the bank for less than what they loan it back out for. (Some home loan rates are less than 5% at the moment). Another example is Interactive brokers - margin rates of 4.5% at the moment. i.e. They will lend you money at 4.5% (secured agains shares of course).
Absolutely agree, sluggish and clunky website for a bank which only has an online presence….not a good look.
The bankwest 5.50 p.a fine print also says cannot deposit more than $500. Does that apply to the initial deposit as well? And funds transfered after 1yr to ordinary account so im assuming account will be automatically closed?
It isn't closed, you just start again at zero balance. So $500*12 months =$6000 is the maximum (excluding interest) that you could have in the account getting 5.5%. This account is no longer for new customers anyway. There are withdrawal restrictions too - if you take any money out or don't put more than $50 in you don't get the 5.5% that month.
Agreed. This is NOT a bargain. Better rate and better terms with ME Bank and for longer too.
ME Bank currently offers the highest interest on savings in Australia.
1.60%p.a is for 12mths
but the base rate is 3.5% which is variable…so wouldn't call it longer…
true if it was terms deposit
Not a bargain - better rate with ME Bank
I currently have an account with uBank and just opened an ME Bank online savings account.
It's no big hassle for me to move my funds and I just go with whichever product is offering the highest rates at the time.
Did you already have an ME bank everyday trans acc or did you open one just now?
RAMS SAver is 4.82%. Must deposit at least $200 a month.
RAMS Saver ==> Incl. 0.8% p.a. variable bonus if each month you deposit $200 and make no withdrawals
So you have to set up an Automatic Savings Plan (ASP) that automatically deposits $200 from a linked account into the Ubank Saver account?
Why can't it be that you deposit 200 from any account each month (and if you don't you only get the base rate not the bonus rate as well), instead of it automatically coming from one account. Pretty inconvenient.
yes it's a bit of a catch that you only start earning the bonus after a month on ASP, but it's hardly back-breaking effort.
found a weakness from ME bank,
withdrawal online to non ME account, limit is max $10k.
if you want to transfer out more, you need to call them, then completed and fax or email a form (staff said available on website) to transfer any $ out, they can do it on the same day.but yeah, not as convenient as ubank.
imagine if one day you need to transfer alot of money and got delayed because of this.Ubank only lets you transfer out $20k at once.
At the moment I have moved everything to ING Direct (5% for 4 months variable). Mainly because the account opening process is very easy and uncomplicated.
I've been a long time Ubank user but I guess this is time to move. Hello ME Bank :) (at least for the next 12 months while the bonus interest rate applies….)
Only 1.6% of the 5.1% applies for the 12 months. The rest is variable.
For whatever reason- maybe Ubank is not so focussed currently on the online saver accounts so much, and is more interested in capturing the term deposit market- currently the ubank term deposit rates for 12 months is 4.80% if you roll it over, I don't think anyone else beats that rate, as far as I know?
Just thought I would throw that in there. (My 2cents + 5.10% worth)
For those bagging uBank's dropping rates, have a look at the other options and you will see that they have dropped by the same amount but just started from a lower %. I opened a RAMS account when it was higher than uBank only to get my sh*t together to transfer across and then have uBank have a better rate again. For the pittance you save ($80 on $50K minus lost interest for the month you transfer over) with the marginally better rates vs the hassle of changing and lost interest in the transfer it hardly seems worth it. Maybe that makes me a bad OzBargainer?
I think uBank has been consistently top 3 with Rabobank, RAMS and now ME popping their heads up briefly, so uBank will get to keep my money.
Plus opening not only a high interest account but also a transaction account with ME seems like too much trouble anyway…In this thread: people who expect to get 6% for their money even if the banks can't find any more people to lend it to.
I have opened a lot of bank accounts since I found OZB:
- Ubank
- ING
- Citibank
and now - ME BankIs it 'bad' to keep closing and opening bank accounts?
I have WAY more than that. Most of them with nothing in them. It really doesn't matter. Having lots of accounts with zero balance is not going to raise any eyebrows. The banks will probably eventually close them. Just don't forget about the ones with you're money in them.
Do you have to close them?
No. you don't.
However, make sure you empty them out if you don't plan on using them regularly. Otherwise, after 3 years, the government WILL TAKE YOUR MONEYhttp://www.news.com.au/money/banking/cash-grab-inactive-bank…
If by "take your money" you mean, "hold in trust".
Just set up a scheduled annual deposit of 1c so your accounts remain active :P
True true but it's the bloody government mate!
It'll take you months at best to get it back from ASIC. Furthermore, you will earn no interest on these amounts once ASIC gets them.
i've got a few. i only ditch the ones that have a monthly account keeping fee
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5.10% at ME Bank
Valid till 6 Dec 2013.
Take what you can while you can.
No regular deposits required.