Term deposits are an investment of cash placed within a financial institution for a fixed period of time, earning fixed interest usually over a one month to five year period. They have proven a popular option with investors who prefer a lower-risk option that near-guarantees a set return, as opposed to investing in riskier assets such as equity and property. Currently, interest rates on term deposits are at historic lows because of today’s low-rate environment.
If you’re interested in a term deposit, it’s also worth knowing you may be charged a fee if you decide to access your funds before your account matures. In addition, there is a chance any honeymoon rate you secured can drop after it matures if you decide to roll over to a new term.
The following tables display the current interest rates on one, two and three-year term deposits from the big four banks – ANZ, Commonwealth Bank, NAB and Westpac. These rates are accurate at the time of writing (18/09/18).
ANZ term deposit rates
ANZ is currently offering the following rates on its term deposit products.
ANZ is currently showing two different rates for each term – this is because one for each is its ‘Advance Notice’ term deposit, which requires the customer to provide a notice of intent (31 days) to withdraw the money. These Advance Notice products come with a higher interest rate, according to ANZ.
| Advertised Rate | Min Term | Max Term | Cooling off period (days) | Interest Paid |
| 1.50% | 12 months | under 18 months | 7 | Annually |
| 2.30% | 12 months | under 18 months | 7 | Annually |
| 1.55% | 18 months | under 24 months | 7 | Annually |
| 2.30% | 18 months | under 24 months | 7 | Annually |
| 1.90% | 24 months | under 36 months | 7 | Annually |
| 2.60% | 24 months | under 36 months | 7 | Annually |
| 1.85% | 36 months | under 48 months | 7 | Annually |
| 2.50% | 36 months | under 48 months | 7 | Annually |
Source: Canstar. Based on $50,000 personal term deposits with terms of one to three years, with interest paid annually.
Commonwealth Bank term deposit rates
Commonwealth Bank is currently offering the following rates on its term deposit products.
| Advertised Rate | Min Term | Max Term | Cooling off period (days) | Interest Paid |
| 2.30% | 12 months | 12 months | 6 | Annually |
| 2.40% | 13 months | 17 months | 6 | Annually |
| 2.40% | 18 months | 23 months | 6 | Annually |
| 2.70% | 24 months | 33 months | 6 | Annually |
| 2.40% | 34 months | 35 months | 6 | Annually |
| 2.50% | 36 months | 47 months | 6 | Annually |
Source: Canstar. Based on $50,000 personal term deposits with terms of one to three years, with interest paid annually.
NAB term deposit rates
NAB is currently offering the following rates on its term deposit products.
| Advertised Rate | Min Term | Max Term | Cooling off period (days) | Interest Paid |
| 2.40% | 12 months | under 13 months | 7 | Annually |
| 2.10% | 13 months | under 24 months | 7 | Annually |
| 2.60% | 24 months | under 36 months | 7 | Annually |
| 2.70% | 36 months | under 48 months | 7 | Annually |
Source: Canstar. Based on $50,000 personal term deposits with terms of one to three years, with interest paid annually.
Westpac term deposit rates
Westpac is currently offering the following rates on its term deposit products.
| Advertised Rate | Min Term | Max Term | Cooling off period (days) | Interest Paid |
| 2.30% | 12 months | 12 months | 6 | Annually |
| 2.30% | 12 months | under 24 months | 6 | Annually |
| 2.40% | 24 months | under 36 months | 6 | Annually |
| 2.50% | 36 months | under 48 months | 6 | Annually |
Source: Canstar. Based on $50,000 personal term deposits with terms of one to three years, with interest paid annually.
You can compare term deposits here to view a much more comprehensive list of term deposits offered not just by the big four, but by all institutions rated by Canstar. You can also compare these rates to the highest term deposit rates on the market in our article here.
The following table displays a snapshot of savings accounts on Canstar’s database with links to providers’ websites, sorted by the total interest rate (highest to lowest). The results and Star Ratings shown are based on a regular saver in NSW with $10,000 in current savings.
Should you consider a term deposit from the big four?
Some people simply choose to go with a big four bank because of name recognition or because they already have an account with them for another product, such as a home loan, credit card or an insurance policy. But there is more to consider – you should also aim to compare term deposits based on:
- The interest rates on offer (the higher the greater return)
- The ‘terms’ (length of the term deposit) available
- Any minimum deposit requirements that exist
- How easy it is to open and withdraw from
- Whether early withdrawals come with penalties or fees
In addition to offering low rates on certain term deposit products, the big four banks also come with other benefits when it comes to term deposits. For one, they are recognised as authorised deposit-taking institutions (ADIs), meaning that deposits up to $250,000 are covered by the government if they run into financial trouble. They also tend to have a high number of branches and financial services available, making it easier to manage and apply for term deposits and other products. However, you may be charged with higher fees than some smaller institutions and could have less negotiating power.
No matter who you end up choosing, make sure you compare the options available to you. And, as always, read the product disclosure statement (PDS) before opening a term deposit so you’re aware of what you’re signing up for!
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