Calculate how your savings grow over time with regular contributions and compound interest. Compare Australian savings accounts and term deposits.
| Item | Value |
|---|
| Product | Rate (est.) |
|---|---|
| High interest savings (online) | 4.5–5.5% p.a. |
| Term deposit (6 months) | 4.5–5.25% p.a. |
| Mortgage offset account | Equivalent to mortgage rate |
| RBA cash rate (mid-2025) | ~4.10% p.a. |
Savings growth depends on three factors: your starting balance, the interest rate you earn, and your regular contributions. With all three working together through compound interest, even modest monthly savings build significant wealth over time. The calculator above models all three components simultaneously.
| Starting Balance | Monthly Savings | After 5 Years | After 10 Years | After 20 Years |
|---|---|---|---|---|
| $0 | $500 | $33,893 | $78,241 | $208,470 |
| $10,000 | $500 | $46,770 | $91,117 | $221,347 |
| $10,000 | $1,000 | $80,647 | $163,993 | $429,817 |
| $20,000 | $2,000 | $163,249 | $329,942 | $861,590 |
| Account Type | Typical Rate | Conditions | Access |
|---|---|---|---|
| High-interest savings (competitive) | 5.0–5.2% p.a. | Monthly deposit + no withdrawals | Instant |
| Major bank savings accounts | 4.2–4.8% p.a. | Varies by bank and balance | Instant |
| Term deposit (12 months) | 4.8–5.5% p.a. | Locked for term | At maturity |
| Offset account (linked to mortgage) | Equivalent to mortgage rate (~6.5%) | Must have mortgage | Instant |
Financial advisers universally recommend building an emergency fund before focusing on investment savings. The standard guideline is 3-6 months of living expenses held in a liquid, accessible account — not locked in a term deposit or super. For someone with $3,500/month in living expenses, this means $10,500 to $21,000 in emergency savings before aggressive long-term investing begins.
| Goal | Amount | Saving $1,000/month | Saving $2,000/month |
|---|---|---|---|
| Emergency fund (3 months) | $12,000 | ~12 months | ~6 months |
| First home deposit (5%) | $35,000 | ~2.8 years | ~1.5 years |
| First home deposit (20%) | $140,000 | ~10 years | ~5.5 years |
| Investment portfolio start | $50,000 | ~3.8 years | ~2 years |
Rates above are at 5.2% p.a. monthly compounding. Times are approximate and assume no starting balance.
What is the best savings account rate in Australia right now?
As of June 2026, competitive high-interest savings accounts from online banks and credit unions offer 5.0-5.2% p.a. These typically require a minimum monthly deposit (e.g. $200) and no withdrawals during the month to earn the bonus rate. Major bank base rates are typically 1.5-2.5% lower.
How much should I save each month?
A common guideline is the 50/30/20 rule — 50% of take-home pay on needs, 30% on wants, 20% on savings and debt repayment. At $70,000 net salary (~$5,400/month take-home), the 20% savings target is approximately $1,080/month. Adjust based on your specific goals and current debt situation.
How long does it take to save $100,000 in Australia?
At $1,500/month with 5.2% interest: approximately 5.1 years. At $2,000/month: approximately 3.9 years. At $3,000/month: approximately 2.7 years. The calculator above shows the precise timeline for any monthly saving amount and interest rate combination.
Should I use a savings account or term deposit?
High-interest savings accounts offer instant access and 5.0-5.2% rates (with conditions). Term deposits offer 4.8-5.5% with funds locked for the term. For an emergency fund or money you may need, use a savings account. For funds you definitely won't need for 6-12+ months, a term deposit may offer a slightly better rate with the trade-off of reduced flexibility.
Is it better to save or invest?
Both serve different purposes. Savings (cash in bank accounts) provide security, liquidity, and guaranteed returns but low long-term growth. Investments (shares, property, managed funds) provide higher long-term returns but with volatility and less liquidity. The standard advice is: build your emergency fund first (savings), then invest long-term surplus after that.