Rising bank rates: some savers benefit from soaring interest rates while others are deprived
Some savers will see their interest increase after the effects of the Reserve Bank’s latest rate hike kick in.
The big four banks have hiked rates on some of their savings accounts, but Australians are being warned that the interest hike has not been applied evenly.
Westpac leads the pack with the biggest increase in any of its accounts, with a 0.90 increase for customers on its Life Savings Account, bringing it to a total floating rate of 3.50 %.
However, customers with its eSaver account miss out on any upside, which falls at a continuous rate of 0.85% after the first five months.
Commonwealth Bank has raised rates on all key savings accounts, with increases of 0.30% and 0.25% respectively for its GoalSaver and NetBank savers.
The Goalsaver account now sits at 2.70% while the NetBank saver has an ongoing rate of 1.35%.
NAB saw a 0.25% increase in their reward saver, bringing it to 2.75%.
However, despite increasing its introductory rate by 0.50% for its iSaver account, NAB has not increased the ongoing rate of 1.10% for existing online savers.
ANZ has increased the rate of its new Plus Save and Progress Saver account by 0.25%, but existing Online Saver customers are absent.
Although the Big Four banks are all raising rates on some of their accounts, experts have warned consumers not to indulge in their banking.
While CBA and Westpac had in some cases outpaced the RBA’s rise this month, many savings accounts were still below the cash rate, according to RateCity research director Sally Tindall.
“The Westpac Life account resumed trading this month with a 0.90 percentage point rise, bringing the ongoing interest rate to a competitive 3.50%. Yet the bank’s existing eSaver customers haven’t seen a penny of extra interest since the RBA’s last hike, leaving their rate at just 0.85%,” she said.
“Don’t assume your bank passes on the RBA hike every month. Give your savings account a health check against the competition at least every two months.
“Savers should aim for a current rate well above the cash rate, at a minimum. While these fares are becoming easier to find, customers will likely need to be proactive to get them,” she said.
It’s also important to consider options outside of the big four banks, says Ms Tindall.
The highest current savings rate according to RateCity is the ING Savings Maximiser at 4.30%.