Online saver offers top rates and flexibility

Dutch bank RaboDirect has launched a new online savings product that pays more than term deposits and is loaded with flexible features.

It is called Notice Saver and is based on surveys about what RaboDirect's customers want in a savings product. Notice Saver pays high interest and is fee free.

It allows you to deposit your money in a high-interest account, paying tiered rates depending on your balance and the notice you give when you want to withdraw it. You can choose between 90, 60 or 31 days' notice. The longer the period, the higher the interest rate.

At the time of going to press, the interest rate on 90 days was 4.65%, 60 days 4.55% and 31 days 4.45%. The highest rate was 0.14% above the highest six-month term deposit rate at the time.

Interest, which is variable, is calculated daily and paid into the account once a month. This compares with term deposits, which have a fixed rate and pay interest at maturity.

Also unlike term deposits, once you have opened a Notice Saver account you can continue to contribute to it. But once your money is in you won't be able to get your hands on it until you serve your notice period.

You can also cancel your transfer any time up to the last business day before the transfer date, making it flexible in case your circumstances change.

There is no limit on the number of notice withdrawals you can place. You can open up to three Notice Saver accounts but must choose different notice periods: 31, 60 and 90 days.

MONEY VERDICT

Around 80% of Australians admit to impulse spending.

Notice Saver is a great fee-free way to lock up your savings and avoid the temptation to spend your money.

It is an ideal savings vehicle for just about any goal but particularly for a house deposit, a holiday, a wedding or Christmas.

It is ideal for self-managed super funds and retirees wanting good income, as well as for small business owners saving for GST. But remember you won't be able to get the money until you have met the waiting period.

Get stories like this in our newsletters.