Deposit Options

There are a number of deposit options offered by banks and the post office. It is important to ensure that your deposit account meets your specific requirements.

Deposit accounts can be broken down as follows:

Demand deposit – these accounts generally pay the lowest interest rate, but give you access to your funds on demand.

Notice Deposit – with these accounts you will have to give a period of notice (generally 30 days) before withdrawing your money. The interest rate applicable is usually slightly higher than demand deposit accounts, but there are no interest penalties on withdrawals where the proper notice is given.

Fixed Deposit Accounts – these accounts are for a fixed period ranging from six months to five years. The interest rate applicable is usually marginally higher that demand or notice deposits. Many banks allow people to withdraw funds within the fixed period, but generally there are penalties associated with breaking a fixed deposit, such as interest earned being clawed back.

Variations of the above deposit accounts are constantly introduced, particularly as banks compete for deposit funds. A number of banks are now offering “interest upfront” accounts where the interest is calculated at the outset and paid up front.

Deposit rates vary greatly from time to time and within each institution. At MDL Financial Consultants we can provide advice on the most suitable deposit options, available at any time.