With many Australians paying off a debt-hangover from the Christmas and New Year period, the Customer Owned Banking Association (COBA) is encouraging people to think beyond traditional banking products, like credit cards and savings accounts, and to consider a Christmas club account instead.  

Need somewhere to store cash and earn interest? The table below features savings accounts with some of the highest interest rates on the market.

Provider

4000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details
  • A high-interest online savings account with no monthly fees, easy withdrawals and award-winning digital banking
  • No withdrawal notice periods or interest rate penalties
  • Save up to 10% on eGift cards at over 50 retailers with Macquarie Marketplace
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Savings Account

  • A high-interest online savings account with no monthly fees, easy withdrawals and award-winning digital banking
  • No withdrawal notice periods or interest rate penalties
  • Save up to 10% on eGift cards at over 50 retailers with Macquarie Marketplace
Disclosure
400$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details
  • Special offer: Savings Accelerator (Kick Starter offer).
  • For a limited time, new ING customers can get a bonus 0.70% p.a. on their savings rate on balances of $150,000 up to $500,000 for the first 4 months. T&Cs apply.
  • If your balance is over $500,000 (but less than $5 million) you will earn the ongoing variable rate of 4.7%
Disclosure

Savings Accelerator

  • Special offer: Savings Accelerator (Kick Starter offer).
  • For a limited time, new ING customers can get a bonus 0.70% p.a. on their savings rate on balances of $150,000 up to $500,000 for the first 4 months. T&Cs apply.
  • If your balance is over $500,000 (but less than $5 million) you will earn the ongoing variable rate of 4.7%
Disclosure
000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details
  • Set up your Pay Cycle and connect your accounts from over 140 financial institutions.
  • Retrace your spending steps into categories with Spending Footprint.
  • No monthly or international fees on any of your transactions.
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Save Account

  • Set up your Pay Cycle and connect your accounts from over 140 financial institutions.
  • Retrace your spending steps into categories with Spending Footprint.
  • No monthly or international fees on any of your transactions.
Disclosure
010000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details
  • Earn up to 5.20% pa by depositing $1,000 in the previous month
  • No account fees
  • Easy access to your money

AMP Saver Account

  • Earn up to 5.20% pa by depositing $1,000 in the previous month
  • No account fees
  • Easy access to your money
010000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details
  • Deposit at least $1,000+ each month from an external source
  • Make 5 or more eligible transactions. Grow your savings balance each month
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Savings Maximiser

  • Deposit at least $1,000+ each month from an external source
  • Make 5 or more eligible transactions. Grow your savings balance each month
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Important Information and Comparison Rate Warning

All products with a link to a product provider’s website have a commercial marketing relationship between us and these providers. These products may appear prominently and first within the search tables regardless of their attributes and may include products marked as promoted, featured or sponsored. The link to a product provider’s website will allow you to get more information or apply for the product. By de-selecting “Show online partners only” additional non-commercialised products may be displayed and re-sorted at the top of the table. For more information on how we’ve selected these “Sponsored”, “Featured” and “Promoted” products, the products we compare, how we make money, and other important information about our service, please click here. Rates correct as of December 7, 2024. View disclaimer.

Important Information and Comparison Rate Warning

Just what is a Christmas club account, exactly? 

Christmas club accounts have been around for more than 100 years, but the modernisation of bank accounts and the emergence of credit cards and buy now, pay later has seen them fall well out of favour. 

They're essentially a kind of savings account that acts like a term deposit, encouraging customers to put amounts of money away each week into an account that can only be accessed at certain times. 

For example, they're frequently used in the lead up to Christmas to help pay for gifts, hence the name Christmas club accounts. 

Customer Owned Banking CEO Mike Lawrence said these accounts are one example of how people can manage their money wisely. 

“Christmas club accounts are a customer-focused product that help customers plan ahead and set savings goals that will leave them with a sense of relief rather than dread after the holidays are over," he said. 

“As an alternative option to manage holiday spending, Christmas Club accounts are a great way to consistently build on your savings throughout the year.”

Gateway Bank CEO Lexi Airey told Savings.com.au in 2019 that this 'old-school' way of saving can be a good way of saving, just as the 'new-school' methods like expense trackers, micro-investing apps and automated savings ’round-ups can be.

“Mainly the preserve of customer-owned banks, Christmas Club Accounts are probably one of the best-kept secrets for saving money,” Ms Airey told Savings.com.au.

“They are designed as purpose-built ‘jam jars’ with restricted access so you won’t be tempted to spend early and importantly, there are usually no account-keeping fees, so you can open as many as you like for different reasons like presents, food, or travel.”

Christmas club savings accounts: Interest rates and fees

Christmas Club accounts aren't offered by as many banks as regular accounts. They're more common among the customer-owned banks, while some larger retail banks like Bendigo Bank offer them as well.  

The interest rates offered on Christmas accounts tend to be a bit lower on average than the standard savings account. 

There are some as low as 0.10% p.a and 0.20% p.a, while many tend to sit around the 0.50% - 0.60% p.a range. 

Gateway Bank offers a Christmas club product with a 1.00% p.a rate, and only allows access from November 1 to January 31st each year.

These rates might seem low, but interest rates on standard savings accounts aren't too hot either, and Mr Lawrence said the interest rate is only one consideration to make. 

"The frequency of payments and when interest is calculated can help earn more through compound interest," he told Savings.com.au.

"Many Christmas Club accounts will also waive account keeping and transaction fees."

While these fees often aren't charged, Christmas accounts do tend to charge fees for early withdrawals, similar to term deposits

"In any event, discussing your goals with a trusted expert can result in a better decision and pathway to savings," Mr Lawrence said. 

Photo by Gabby K from Pexels