ANZ Ups Ante for Savers with New Balance Condition

2

The standard rate on ANZ's Plus Save accounts has been cut from 4.9% to a mere 0.5%. However, those meeting the new condition will be rewarded with a bonus 4.5%, bringing the total rate up to 5%.

This shift follows a similar strategy employed by Westpac last month. Westpac decreased its base rate by 0.15% but countered it by increasing its bonus rate by the same margin. Consequently, Westpac Life customers could still attain a maximum rate of 5%, on the condition that their balances increased each month.

An Australian Competition and Consumer Commission (ACCC) study indicated that about 71% of bonus interest accounts failed to secure bonus interest in any given month. This statistic casts a shadow over those hoping to benefit from ANZ's new terms without ensuring they meet the additional requirements.

According to Laine Gordon, Money Editor at RateCity.com.au, ANZ’s new policy presents a mixed bag for savers. “Those who can stash away an extra $100 or more each month will enjoy a boost in their interest rates,” said Gordon. “On the flip side, those unable to save an additional amount will find their savings progress severely hindered.”

Despite the potential for more attractive ongoing rates of 5% or higher, Gordon recommends that consumers scrutinize the terms closely. “Many high-interest accounts are fraught with specific conditions that can easily disrupt your monthly interest,” she cautioned.

Sally Tindall, Data Insights Director at Canstar, provided further insights, highlighting the volatility in savings rate structures. Over the past three months, there have been 12 instances where existing account rates decreased, while only three saw an increase.

“The changes to the ANZ Plus Save accounts will benefit some customers with higher interest rates,” Tindall noted. “However, the rest will experience a substantial drop if they fail to meet the new terms.” She also pointed out that ANZ Plus initially attracted savers looking to avoid complex conditions, making this shift particularly jarring for long-term customers.

Though most high-interest savings accounts come with specific requirements to secure the top rate, Tindall mentioned there are a few exceptions. “Some banks still offer rates above 5% with minimal to no monthly conditions, while others hover around 4.75%,” she explained.

For dedicated savers who can consistently meet the conditions, these bonus schemes might be worthwhile. Conversely, those who find it challenging to adhere to monthly terms might benefit more from a simpler, more straightforward account with a competitive rate.

The key takeaway, as Tindall advises, is to find a savings account that aligns with your saving habits and lifestyle to make the most of your financial gains.

This article was originally published by NewsWire under the headline "ANZ slashes interest rate on customers’ savings accounts unless they meet new conditions".

Published:Thursday, 3rd Oct 2024
Source: Paige Estritori

Share this news item:

Finance News

Major Australian Banks to Compensate Millions Over Unjust Fees 04 Oct 2024: Paige Estritori In an unexpected windfall for numerous Australians, several leading banks are set to return millions of dollars after imposing unjust fees on their customers. This comes in response to an investigative report conducted by the Australian Securities and Investments Commission (ASIC). - read more

Strain on Aussie Borrowers: A Deeper Dive 03 Oct 2024: Paige Estritori In Australia, financial pressures are mounting for many households. According to the latest Financial Stability Review (FSR) from the Reserve Bank of Australia (RBA), approximately one-in-20 Australian borrowers are facing negative cash flow situations. - read more

ANZ Ups Ante for Savers with New Balance Condition 03 Oct 2024: Paige Estritori In a move that has left many Australians reevaluating their savings strategies, ANZ, one of the nation's largest banks, has significantly altered the interest rates on its savings accounts. The bank has introduced a stipulation that demands customers grow their balance by at least $100 each month to avoid a drastic reduction in interest rates. - read more

ATO Clarifies Rules on Tax Deductibility of Financial Advice Fees 03 Oct 2024: Paige Estritori The Australian Taxation Office (ATO) has recently clarified its position on the tax deductibility of financial advice fees, marking a definitive standpoint on the matter. This move is expected to significantly impact the financial advisory sector in Australia. - read more

Potential Early Rate Cut by RBA Sparks Discussion 01 Oct 2024: Paige Estritori In a sudden shift, all four major Australian banks are now forecasting that the Reserve Bank of Australia (RBA) may reduce interest rates by February of next year. This comes after NAB (National Australia Bank) updated its timeline, initially expecting a rate cut in May 2025. - read more