What type of savings account do people want?
20 Apr 2016
What do Australians really want in a savings account? Canstar’s extensive database reveals the results.
Bonus savings account or SMSF savings account? $200,000 in savings or $2,000 for emergencies only? To link a transaction account or not to link?
Over 150,000 people visited our site to compare savings accounts between July 2015 and April 2016. After some digging into this extensive database, we’ve found some interesting stats about what Australians are looking for when squirreling away their savings.
Savers and spenders alike, take notes…
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How much do we have in savings?
The most common levels of current savings entered by visitors comparing savings accounts are:
- $150,000 – $200,000: 11%
- $100,000: 13%
- $50,000 – $75,000: 14%
- $20,000 – $49,000: 16%
- $10,000: 13%
- $5,000: 10%
As you can see, many people comparing savings accounts in Australia have a reasonable amount of cash in savings!
ASIC’s MoneySmart recommends that you save up enough money to cover your expenses for 1 – 3 months. According to the ABS (2016), the average Australian adult earns $1,145 per week, or $5,152 per month. So a 1-month emergency fund should have at least $6,000 in it to be safe.
This way, you have funds available for emergency needs such as car servicing or repairs, unexpected medical bills, broken down appliances, travelling to be near family during a crisis, or being unable to work due to illness, injury, or unexpected retrenchment.
If you’re self-employed or work on a casual or seasonal basis, you might want to consider setting more aside in emergency savings.
You can make sure you only use this money for real emergencies by keeping it in a separate account or sub-account and topping it up again if you use it.
If you’re in a position where you don’t have any savings at all at this point, it’s time to look for some free help to set a budget and start saving. There are some charitable organisations that help low income earners with their saving goals, such as the CAP Money Course by Christians Against Poverty or Saver Plus by the Brotherhood of St Laurence.
Do you have enough in savings?
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A 65% majority of visitors to our site want a Bonus Saver account to earn extra interest. This requires being disciplined enough to deposit the required amount each month and follow other conditions such as making no withdrawals from the account.What type of savings account do we want?
The next most popular type of account is the Online Saver. This allows you to manage your account entirely online, transferring money in and out as needed.
Cash Management Accounts are popular with 9% of savers.
Senior Savers and Junior Savers follow up at around 5% and 3% respectively.
What features do we want in an account?
Interest is the number one thing we care about, it seems – how much we can earn, and when it will be paid to us. Visitors to our site most frequently filter their comparison results by:
- Interest calculated daily: 26%
- Interest paid monthly: 22%
- Interest paid quarterly: 3%
We live in a fast-paced and digital age, so it is no surprise that 10% of visitors specifically want to be able to apply online.
Many want their money to remain accessible and “at call” although it is in savings:
- ATM access: 7%
- EFTPOS facility: 5%
- Branch access: 5%
Interestingly, 14% of savers take a different approach, saying a linked transaction account is not required, indicating they intend to put money in and rarely take money out. This approach is fine as long as you don’t “set and forget” your account. Remember, interest rates do go up and down and this makes a big difference to how quickly or slowly your nest egg grows.
Looking for the best value
The majority of Australians are keen to get the best possible value out of their savings account – which makes sense since it is usually responsible for holding the largest chunk of your money.
65% of visitors select an outstanding 5-star rated account, while another 19% find a 4-star rated product that suits their needs just fine.
No matter which account or institution you choose, make sure you compare your options first. You can use our website to compare at call savings accounts or compare transaction accounts across a broad range of types, features and fees.
Need your money accessible but still earning interest?
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