Stop Throwing Money Away: Don’t Let This Costly Savings Mistake Drain Your Bank Account!

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Save your hard-earned money with these easy tips to avoid the costly mistake of throwing away your savings!

With his fixed-rate mortgage ending in November, Christopher Wink is confident he’s prepared. Last year, the 36-year-old aviation worker and his partner sold their investment property and put the proceeds into a high-yield savings account with UBank – earning an impressive 4.10 per cent interest! With this financial preparation, they can rest assured knowing they’re ready for what lies ahead.

“Realising that our money was doing nothing sitting idly in the bank, we put it to good use. After selling off our investment property, we were eager to deploy those funds into something profitable,” he says.

“We aspire to gain the most sizable interest rate so that once our fixed-rate home loan (which is currently 2.19%) expires, we can use the resources from our account to substantially pay off or lower [the same home loan].”

As the Reserve Bank of Australia works to increase interest rates continually, 20% of borrowers with fixed-rate mortgages will face payment challenges when their contracts expire in 2023. Wink is one such borrower preparing for those changes ahead of time.

On Tuesday, the Reserve Bank of Australia drove the official cash rate to 3.35 per cent with its ninth successive rise in rates -but you don’t have to suffer this blow! Experts push savers towards finding a more beneficial deal on their savings accounts to reduce any discomfort caused by these hikes.

He wishes he had earlier diverted the money into a high-interest bank account. “If we had begun our search for a better rate sooner, we would have gone far with interest earnings. This was an opportunity wasted.”

BFG managing director Suzanne Haddan believes many Australians needlessly pay a “loyalty tax” by not seeking better options after years of rock-bottom interest rates have crippled savings accounts.

Therefore, she suggests that savers should take the time to review their accounts.
With savings accounts, you can start at zero and even have a negative interest rate with a fee. Plus, if you’re under 35 and trying to save money, the highest possible interest rate of 4.75% should grab your attention! She explains, “That in itself should get people’s attention.”

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