What is a term deposit and how it works.

Read time 3 min

How term deposits work, how they’re different to a savings account and what to think about before you invest.

About term deposits.

A term deposit is an account where you lock away money for a set amount of time (a ‘term’) at a fixed rate. Terms can range from one month to five years.

Unlike with a savings account – where you can access your money anytime in online banking or the Bankwest App – a term deposit is designed to make it harder to withdraw funds. If you want to access money in your term deposit, you’ll need to give us 31 days’ notice and pay a fee, and the interest you earn will be adjusted (so you'll get a lower interest rate for the term).

Why open a term deposit.

You might want to open a term deposit over a regular savings account if:

You want to lock away funds you don't need immediate access to and earn interest on them at a fixed rate
You want to make it harder for yourself to withdraw your money
You’re an established saver who can meet the initial minimum deposit requirement of $1,000.

Open a term deposit

Making the most of your term deposit.

To milk your term deposit for all it's worth, think about:

How long you’ll invest for.

If you choose a longer term and interest rates rise, you’re locked in at a lower rate. On the other hand, if you invest for a shorter term and interest rates fall, you could be stuck with a lower rate if you choose to reinvest.

Research market trends before you invest so you can make an informed decision.

When the interest is paid.

If your term is less than 12 months, we'll pay you interest at the end of your term. If it's 12 months or more, you can choose whether you'd like interest to be paid monthly, quarterly, half-yearly or annually – it must be paid at least once a year. The interest rate you get for your term will vary depending on how frequently interest is paid.

What happens at the end of my term?

At the end of your term you have seven calendar days – known as a grace period – to let us know what you'd like to do with your term deposit. We'll remind you around ten days before your grace period begins, so you can start thinking about your options.

During your grace period, you can choose to:

Reinvest your current balance for another term
Withdraw or add funds, then reinvest
Transfer your balance to another account and close your term deposit.

If you don't give us any instructions, we'll automatically reinvest your total balance for the same amount of time at the relevant rate. Make sure the term length and rate are still the best option for you.

You can manage your Bankwest Term Deposit in online banking or by giving us a call.

If you have any of our other term deposit accounts, you can manage your term deposit by messaging us in the app or online banking, or by calling our Term Deposit Direct team on 1300 132 574.

Withdrawing money during your term.

To withdraw all or part of your funds before the end of your fixed term, you'll need to give us 31 days' notice – you can do this via online banking or by giving us a call.

If you're experiencing financial hardship, you may be able to access your funds immediately. Contact us to chat through your options.