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When saving for a first home deposit every single bit counts. There are 3 traditional types of accounts that most people invest their savings in:

Everyday savings accounts

Most of us need an everyday transaction bank account for lifestyle expenses (with a Deposit Visa Card or MasterCard attached to the account). What we don’t need to do is put up with expensive, unnecessary high fees.

High interest savings accounts

Moving money from your everyday transaction account to a high interest savings account can be a worthwhile action. It will alleviate the temptation to use the money if it is sitting in your high interest savings account and will bring you a greater interest return.

Term Deposits

Term Deposits are special bank accounts that lock your money away for a given period of time (usually between 30 days and 5 years). Term deposits are good for those first home buyers who tend to be impulsive buyers as this ensures your money is locked away for a fixed period of time whilst earning competitive returns on the money you have invested.

Aspiring first Home buyers may also want to consider investing in other asset classes such as shares and bonds which can provide higher returns than savings accounts. If you are new to investing, managed funds can provide lower entry costs to a variety of asset classes. You should consider your circumstances before investing in other asset classes and consider seeking professional advice from a Financial Planner.


If for example you currently have $20,000 in your savings accounts it could be a worthwhile exercise to consider diversifying this money into the 3 different account types:

Leaving 5% in your everyday savings/transaction account for your everyday needs

Transferring a portion in a high interest / at call savings account

Locking the rest away in a term deposit

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