The economy’s bumbling its way out of a mining boom, the budget’s gonna blow and the Aussie dollar keeps heading north, despite the RBA’s best efforts to talk it down.
On the back of that, Glenn Stevens has got the scissors out. Sharp ones, too.
The majority of market pundits and astute economists across the country are expecting the RBA to use them to cut the official interest rate to 2 per cent at 2:30 this afternoon.
What will happen after that?
The move will knock a bit of stuffing out of the dollar, lift the local sharemarket and turn the heat up on a partly boiling property market.
It also means the interest rate on your savings account is about to be chopped. So, if the RBA does snip rates again this afternoon, you really should review where your money is socked away to earn the best rate possible.
To help you get started, here are a few of the top earning, short-term cash stashing places right now to measure your accounts against. All rates quoted are per annum.
The best you’re going to get on a term deposit is about 2.45 per cent for a three month deposit with Westpac. Given this is lower than savings accounts are offering, and it locks your money away for a fixed period, this probably isn’t the best bet right now.
The Orange Everyday Account looks like one of the best around, offering an interest rate of 3.75 per cent. That’s a base variable interest rate of 2.50 per cent, plus a bonus 1.25 per cent when you kick at least $1,000 into it each month.
No fees, as you should expect from any online account.
Peer-to-peer platforms allow you to lend your money to other credit-worthy people. For a one month loan through Rate Setter, you can earn about 3.5 per cent and for a 12 month loan it’s 5 per cent. The longer you’re willing to lend your money, the better rate you’ll get, with a three year loan currently earning about 7 per cent.
The interest rates quoted here are after any fees to the middle man, so again it’s a pretty straightforward comparison.
Of course, you could look at kicking off a share portfolio or slipping a bit more into your super, too.
More on that side of things here:
Image: Steven Depolo, via Flickr