There are various options for increasing your money over time, ranging from property investments to stock purchases. However, if you want an easier approach to grow your passive income, you can start by applying for a savings account.
A savings account is a safe bank account in which you can earn interest over time. These accounts pay larger interest rates than normal transaction accounts, allowing you to save for large purchases such as a car or a down payment on a home, or to put money aside for the rainy days. To earn the high interest rate, you usually need to deposit a specified amount of money into the account each month.
A savings account is a good idea in general, and they're usually free—especially at online banks, community banks, and credit unions.
It's risky to keep cash elsewhere that you don't intend to spend right away, and using a savings account has a psychological advantage: it's difficult to spend cash on the spot. A savings account, on the other hand, can be used to stash money aside for longer-term purposes.
For those of you who would like to open a savings account or would like to switch to a new one, here are the top savings account as of Q1 2021:
|Bank||Heartland Bank YouChoose||Kiwibank Notice Saver||Rabobank PremiumSaver||Rabobank Notice Saver||SBS Incentive Saver|
|Interest Rate||0.50% p.a.||1% p.a.||0.20% to 0.75% p.a.||1% p.a.||0.50% p.a.|
|Minimum/Maximum Deposit||No minimum deposit, up to $100,000||Opening balance at $2,000||No minimum deposit, up to $100,000||Opening balance at $1,000 up to $5 million||No opening balance|
|Withdrawals||Allowed. No penalty||
Allowed with 90-days notice
|Allowed. No penalty. However, if your balance goes below $50 between months, the bonus interest won't be paid.||Allowed||Not allowed within the 3-month perio|
When it comes to opening a savings account, many individuals go to their local bank, but the rates are likely to be lower than expected. You might want to look at something other than a standard savings account to earn the best potential rate.
For larger earnings and reduced costs, online-only accounts are a good choice as the overhead costs of online banks are lower than those of traditional banks.
As a result, online banks provide many of the highest-yielding savings accounts. Many online banks have no minimum deposit requirements, while higher-yielding accounts may require bigger deposits.
NZCU is among the best online savings accounts in New Zealand, along with Heartland, which has been recognised by Canstar in 2020. You can easily apply online, through phone banking, or visit one of their branches to get started. This type of account is best for those who are only starting to save or would like to safeguard their money for certain occasions.
With NZCU Baywide, you can access your money at any time without the costly charges. Plus, they offer competitive interest rates up to 0.55% p.a. for more than $20,000 deposit or balance.
ANZ Online Savings offers a flat interest rate of 0.05% p.a. where you can access your money through ANZ goMoney, Internet Banking, phone banking and through their branches.
A savings account is an excellent way to keep money safe for future requirements. Savings accounts are especially handy for money that you may require in the coming years. You won't make much money in interest, but as long as your savings are federally insured and you avoid fees, you won't lose any of it.
They are commonly used for the following purposes:
If you want to buy a house or a car in the next few years, you'll almost certainly need a down payment to get the best loan conditions. While you're getting ready to buy, a savings account is a wonderful location to build and store that down payment.
You'll have a better time on vacation when you're not borrowing the money and have enough income to support yourself. By moving money from your salary to a savings account every month, you can build up a vacation fund. You won't be tempted to spend that money if you take it out of your checking account.
Life always tends to surprise us, so it’s smart to keep an emergency fund on hand. You can prevent taking on hazardous debt by having an emergency fund. Savings account funds are often available without penalty, allowing you to address problems right away.
Aside from a KiwiSaver account, you can also apply for a bank or savings account for your child in one of the best bank accounts for kids in NZ.
Opening for your child’s first bank account is simple. Here are some of the requirements to get started.
There are numerous banking options in New Zealand, all of which provide appropriate services to foreigners. ANZ, ASB Bank, BNZ Bank, Kiwibank, and Westpac are the most well-known. These include some of New Zealand's greatest online banking alternatives, as well as no-fee bank accounts.
In some instances, these banks don’t impose a banking fee but you may be charged 15 NZD (10 USD) to transfer money from your current account abroad to your new account.
Credit unions and building societies are other viable banking options if you're seeking something different. Despite the fact that these are not traditional banks, they are regulated by the Reserve Bank of New Zealand, which is where all banks should be registered.
The vast majority of banks have no account-maintenance costs on savings accounts.
However, savings accounts are likely to be subject to withdrawal fees. You have various options for paying interest on your account. There are "flat" rates and "tiered" rates, with higher interest rates offered to those who save more.
There are additional accounts that pay a set base rate plus a bonus rate if no withdrawals (or deposits) are made throughout the month. In most circumstances, if you take money out of your account, you'll forfeit your chance to earn bonus interest.
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