Find the bank account for you

There are signs that Australia’s inflation could be trending upward again, thanks to an uptick in Monthly CPI figures in September 2023. However, this is not set in stone, with the next round of quarterly inflation data not due until the end of October 2023. Looking ahead, Australia’s Big Banks are forecasting that rates should stay on hold for most of 2024, which could offer Australians under cost-of-living pressures a chance to get their finances under control.

One small financial change that could potentially make a big difference, switch to a bank account that charges low or no account-keeping fees. Removing even this small expense could affect your household budget over time, allowing you to keep more of your money in your pocket.

Some of the fee-free bank accounts on the RateCity database at the time of writing include:

• Suncorp Bank Everyday Options
• AMP Bank Access Account
• Macquarie Credit Union Access Account
• ANZ Access Account

Updated by Mark Bristow on 3 October 2023.

A bank account, also known as a transaction account, is an everyday account used to manage your finances. Everything from paying bills to depositing your income to withdrawing cash is managed through a bank account. 

Bank accounts allow you to make payments in a number of ways:

• Online shopping
• Electronic payments (including paywave)
• Digital wallet (e.g. Apple Pay, Samsung Pay, Google Pay)
• ATMs
• Direct debit
• Bpay
• Branch access
• Cheques

The main deposit accounts you can open in Australia include:

• Transaction accounts. Your classic banking account. A transaction account allows you easy access to funds deposited by yourself or others via online banking, mobile banking or Mastercard or Visa debit cards. Money can be withdrawn via ATM or in branch. 
• Savings accounts. A savings account is a bank account that allows you to accrue interest on your regular deposits. They may come with bonus interest rates that can only be earned from meeting conditions, such as not making withdrawals, or for an introductory period. These accounts are designed to help you meet your savings goals.
• Term deposit. A term deposit is a type of depositing account in which you lock away your savings at a set interest rate for an agreed upon period of time. They are different to savings accounts, in that once the money is deposited, it's much more difficult to access until the account has reached maturity. This is designed to help you not dip into your funds. 

Fees can differ from one bank account to another, but the main fees you may encounter include: 

• Monthly account-keeping fees
• ATM withdrawal fees
• Phone banking fees
• EFTPOS fees
• Internet banking fees
• Branch fees
• Paper statement fees
• Overdraft fees (if you withdraw more than what is available in your account)
• International transaction fees

Yes, this sounds like a lot of fees. But the good news is that most banks offer a basic everyday bank account that has:

• No account-keeping fees
• Free monthly statements
• No minimum deposit amounts

• For more information around which fees a bank account may charge, check out the product disclosure statement (PDS) and T&Cs, generally located on the provider's website.

Use a debit card over a credit card

Bank accounts usually come with Mastercard or Visa debit cards, which can be used similarly to a credit card, both online and in-store. When you use a debit card, you’re spending your own money rather than credit. If you don’t want to be hit with interest on your purchases, it may be a good idea to use your debit card instead of your credit card.

Be careful with security

Once someone has your bank account details, they could use it to spend your money. When it comes to your physical cards and online banking, it’s worthwhile changing your codes and passwords often, and avoiding using predictable passwords or PINs (like your name or date of birth). Always check your bank statements to make sure you’ve been charged correctly, and that there aren’t any charges that weren’t authorised by you. If there is a suspicious transaction, contact your financial institution immediately. 

Keep essential funds in your bank account

Australians sometimes save large amounts of money in their everyday transaction accounts, which can be a mistake. It may be better to keep only the money you need for your everyday banking in your transaction account, and to move the rest to a savings account, where you can earn interest at a higher interest rate. You generally don’t need to access large amounts day-to-day, so always budget and designate funds to where you think they best belong. 

Check out online and mobile platforms

Most banks, credit unions or building societies have apps or websites for mobile banking or internet banking. These online banking platforms allow savers to view their balance, pay bills or transfer money on the go.

Pros

• Different accounts for different purposes - If you like to be organised, then you may prefer using different bank accounts for different purposes. For example, you could have one bank account for day-to-day expenses (such as petrol and food), another account for rent or mortgage repayments, and a third account for your child’s pocket money. For some people, this level of organisation could be one way to budget effectively.
• Access special features and bonuses - Often, a bank, credit union or building society will offer special rewards, bonuses or benefits for opening a bank account, such as a lower introductory fee, waived account-keeping fees, or even a fee free deal. Opening up more than one bank account could increase these benefits. Banks also sometimes offer package deals. For example, the bank could offer you perks if you take out multiple banking products (including a bank account). It’s important to do your research on any financial product before signing up and make sure you’re signing up to one that best suits your financial situation, not the one with the most attractive perks.

Cons

• Multiple bank accounts can just be plain confusing – If you’re not overly organised or lose track of things easily, then multiple bank accounts might not be for you. Constantly moving and sorting funds can be complicated and time-consuming. If you prefer a more hands-off approach to your money, then one bank account may be the way to go.
• You can be hit with multiple fees – Bank accounts often come with a mixed bag of fees, from monthly account fees and overdraft fees to ATM withdrawal fees. So, having multiple bank accounts could increase your risk of paying more fees. If you’re opening multiple accounts to take advantage of features and benefits, then be aware that once you add up the fees across multiple bank accounts, the benefits may not be worth it in the end.

Bank accounts are offered by basically every bank, credit union and building society in Australia, from ANZ to Citibank, NAB, HSBC, Westpac, Bankwest, Commonwealth Bank, ING, Suncorp and UBank, to name just a few. 

Many everyday banking accounts from different institutions are fairly similar to one another, though a few offer special features and benefits that could benefit certain Australians, depending on their financial situation.

There is no single “best” bank account for everyone, so always do your research to make sure you’re getting one that suits your individual needs.