Savings interest rate calculator: How much interest can you earn?

A savings calculator is an online tool that estimates how fast your savings could grow in a savings account.

To use our interest calculator, all you have to do is follow a few steps:

Based on the information you enter, the calculator will then estimate: 

• Your estimated final balance.
• The total interest earned over your elected savings period.

Using this savings calculator, you can compare different scenarios (e.g different deposit sizes and saving periods) and see how your savings could be affected.

Note that this calculator is designed to help you work out the total interest you could earn on your savings in a specified period. It is not intended to be relied upon for making any decision regarding a financial product. Calculations assume that details entered into the calculator, including interest rates, do not change for the savings period.

It's advisable to carry out independent research to find a financial product that suits your needs or seek financial advice from a licensed expert instead of solely relying on the results obtained through this calculator.

Savings accounts often have variable interest rates, meaning that your bank may choose to raise or lower these rates to suit the market and economic conditions. When calculating how much interest you could earn with a savings account, it’s important to consider that the interest rate when you first open the account may not be the same as the interest rate later on. 

Banks and other financial institutions set the interest rates on their savings accounts based on a wide range of factors. One significant contributor is Australia's national cash rate, which is set by the Reserve Bank of Australia (RBA). This benchmark rate affects interest rates across the country, on loans as well as deposits. 

The RBA Board meets eight times a year (twice a quarter) to discuss whether to raise the cash rate, cut the cash rate, or keep the cash rate on hold. A rising cash rate could make it easier to grow your wealth faster, as your bank may pass this rate hike on to savers as higher savings account interest rates. However, if the RBA cuts the cash rate, banks might also cut savings account interest rates, making it that little bit harder to grow your wealth.

Keep in mind that banks may not always pass on RBA rate changes to their customers, whether savers or borrowers. Banks may also choose to raise or lower their variable interest rates at any time, out of cycle from the RBA.

Term deposit

If you know that you may be tempted to dip into your savings account from time to time, you could consider locking away your money in a term deposit account for a few months or years to earn interest. 

A term deposit is where you agree to deposit money in an account that cannot be touched without penalty for a fixed length of time, and earn interest on your savings over this term. The more money you deposit, and the longer the savings term you choose, the higher the interest rate you may enjoy. You can't easily access your savings until the end of your term, which could help you make progress towards your savings goal.

Consider checking out our term deposit calculator to work out how much interest you could potentially earn. Keep in mind that many term deposits pay simple interest rather than compound interest, which could affect your savings plans. 

Superannuation

If you are looking for a savings plan for your retirement, consider checking the status of your superannuation fund. Consolidating your super and selecting one fund with fees, charges, and investment options that suit your needs can help make a big difference to your future lifestyle. Making extra superannuation deposits can help to further build this balance.

To earn more interest on your savings, you may want to look for a savings account offering a higher interest rate. But the savings accounts with the highest interest rates are also the accounts most likely to have strings attached. 

For example, you may be offered a high introductory interest rate when you first open a savings account, letting you make the most of the interest earnings over the first few months. But once this period expires, you may revert to a lower interest rate instead. 

Other savings accounts offer higher bonus interest rates for borrowers who fulfil certain terms and conditions, such as making regular deposits and no withdrawals. If you can’t comfortably fulfil these requirements as part of your regular household budgeting, you may only benefit from a much lower interest rate. 

Whatever the interest rate, the more money you can deposit into a savings account, and the longer that money stays there, the more interest you may be able to earn over time. You can use the calculator to estimate just how much you could potentially earn in different scenarios.

Many Australians compare savings accounts by looking at the interest rates they offer. While interest rates are important, they’re not the only aspect that’s worth considering. 

You may want to also look at:

• Terms and conditions for any bonus rates
• Any other special requirements
• Extra value-adding features and benefits
• Convenient access to your savings (e.g. via apps or online banking)

To help make your savings account comparison quicker and easier, RateCity’s Real Time Ratings™ combine the interest and flexibility of each savings account into a single star rating, which is updated regularly for accuracy. The top-rated savings accounts in different categories are ranked on RateCity’s Savings Account Leaderboards, with the top-ranked savings accounts in different categories becoming eligible for a RateCity Gold Award.