What is Savings Account?
A savings account is an interest-bearing deposit account held at a bank or other financial institution. Though these accounts typically pay only a modest interest rate, their safety and reliability make them a good option for parking cash that you want available for short-term needs.
Savings accounts may have some limitations on how often you can withdraw funds, but they generally offer exceptional flexibility that’s ideal for building an emergency fund, saving for a short-term goal like buying a car or going on vacation, or simply sweeping surplus cash you don’t need in your checking account so it can earn a little interest.
Best Savings Account In South Africa
African Bank
The African Bank MyWorld bank account offers users a variety of attractive, beneficial features, with the Power Pocket feature ensuring efficient, hassle-free day-to-day banking while the savings pocket provides excellent features that include some of the highest interest rates.
A positive account balance in the MyWorld Account earns interest of 3.50%, the power pocket earns 3.50%, and the savings pocket earns 4.50% per annum.
There is a monthly bundle fee of 0 ZAR, with balance inquiries billed at 3 ZAR for both POS and ATM inquiries. Withdrawals from ATMs are charged at 6 ZAR per 1000 ZAR with POS withdrawals at a fixed 2 ZAR per transaction.
Nedbank4me Account
This account is the first step that customers can take towards becoming financially responsible as well as independent. It is designed for customers up to the age of 18 and it is a savings vehicle that can be used to save pocket money, money that is gifted, or money earned from part-time work.
The savings account is exempted from most charges as well as account maintenance fees. Interest rates are typically higher than those of normal savings accounts, especially on lower balance ranges.
It costs only 10 ZAR to open this savings account, and interest can be earned from 50 ZAR and upwards. The best interest that can be earned on this account, despite the balance, is 3%.
Apart from other features, this savings account also helps customers support a cause that they consider important at no additional cost. This can be done easily by linking the savings account to any of the following charities:
The Green Affinity.
Arts Affinity.
Culture Affinity.
Sports Affinity.
Nelson Mandela Children’s Affinity.
FNB Fluid Youth Account
This savings account is specifically designed for children in teaching them to learn money management from an early age, to prepare themselves for a financially smart future. This Savings Account has a variety of benefits and it teaches the joy and art of saving and having certain financial security.
This account allows for safe and secure money transfers using a PIN-based MasterCard debit Card. The account is available for children aged 18 years and younger, and has the following features:
There is no minimum deposit to open an account.
There are two distinct pricing options to choose from.
The ability to keep track of transactions via SMS or email.
Account fees can be redirected to a parent or guardian’s FNB account.
Access to the account via ATMs, online banking, cell phone banking, or FNB branches.
The account earns interest between 0.25% to 1.80%.
Balances of 500 ZAR and higher are not subjected to monthly account fees.
Standard Bank PureSave Savings Account
With this account, customers can easily start saving and the account can be used as a casual savings account while earning competitive interest rates on balances.
With the Standard Bank PureSave Savings Account, customers can gain instant access to their funds when they need it the most, and they are granted the ability to move money to their account via a stop order.
There are variable interest rates on this savings account, and they are also tiered according to the account balance. This is calculated daily, and the interest is paid monthly. The PureSave Savings account can easily be linked to the Standard Bank ATM card to allow customers the ability to manage their account online, via their cell phone, or at any Standard Bank ATM.
To qualify for the Standard Bank PureSave Savings Account, customers need an opening deposit of 50Z ZAR. There is no monthly fee, and while the minimum interest rate that can be earned on amounts from 50 to 10 000 ZAR is 2.15%, the most that can be earned is 2.90%.
FNB Savings Account
The FNB Savings Account is an account that only individual Cheque Account clients can access. It is one of the most flexible savings accounts that features a ‘save my change’ option that allows for multiple deposits into the savings account.
Customers can set up scheduled transfers which will automatically move money from their cheque account into their savings account as well as cash investment accounts automatically.
This allows for a disciplined way of saving, especially when there is a specific purpose and goal that the customer has in mind. There is also no waiting period to access funds; to make a withdrawal, customers can merely log into either their Internet banking or mobile app and request a transfer from the savings account to the transactional account.
The interest rate that customers can qualify for will depend on the balance of the account, with 3.8% from 75 000 ZAR and upwards. The interest rate subsequently increases as the account balance increases, with more savings earning higher interest.
ABSA Savings Account
The ABSA savings account helps customers address one of the many challenges that South Africans face such as getting a savings account started. With the ABSA Savings Account, customers get two free ATM cash deposits, encouraging people who earn monthly or fortnightly to top-up their savings for free at least twice a month.
ABSA also offers unrestricted access to the Savings Account as there is no notice period that must be served before the savings funds can be accessed. The interest rate that can be earned is calculated according to the daily balance and it is paid into the account monthly.
The interest rate is variable and linked to market conditions as well as the prime lending rate. On average, the interest rate ranges from as little as 0.70% on balances from 50 ZAR up to 3.50% on larger account balances.
African Bank Fixed Deposits Account
Fixed Deposit Investments are one of the best ways through which to invest either short, medium, or long-term. African Bank has mastered these savings accounts ahead of the rest in South Africa as the bank holds the best-fixed deposit rate in the country.
The savings strategy will determine the fixed deposit account, with investing that can start from 3 months and last up to 60 months with interest withdrawals optional. However, before investing or locking down money into an account such as this, customers must understand what it entails.
The interest rates that customers can expect, depending on their investment term are as follows:
3 months – up to 4.66% at expiry.
6 months – up to 5.18% at expiry.
12 months – up to 6% at expiry.
24 months – up to 6.97% at expiry.
36 months – up to 7.78% at expiry.
60 months – 11.11% at expiry.
Capitec Savings Account
The Capitec Savings Account is one of the most popular and best savings accounts offered in South Africa, with the bank offering competitive interest rates, and most customers who bank with Capitec have expressed satisfaction with the interest that they are earning.
The common Capitec savings account is the Globe One account which consists of four different plans, namely:
Transaction Account.
Savings Account which is the main account.
Flexible Savings.
Fixed Term savings.
Tax-free savings.
There are numerous benefits of banking with Capitec, some of which include:
The absence of fees for shopping online, swiping for fuel purchases, or paying accounts worldwide using the Global One Account.
The ability to tap to pay using either the Global One Debit or Credit Card.
Fixed ATM withdrawal fees, no matter how much is drawn at a single time.
The transactions that customers make attract fixed banking costs on top of the 5 ZAR monthly admin fee that is paid.
The interest which is earned on savings is calculated on the daily account balances and it is paid at the end of each month.
The interest rate is determined by account balances and the higher the account balance, the higher the rate which is used. Interest from 2.5% can be earned per annum, depending on the account balance, with the highest rate clocking in at 2.75%.
Which savings account in South Africa is the best?
That will largely depend on the client and his/her preference. Here is a review of the best savings accounts in South Africa at the moment.
Should I keep on saving my money?
When you have 3-6 months of expenses saved up it is always a good idea to opt to save more so that you can build a buffer and earn more interest on a larger balance in your savings account.
Which bank pays the highest interest rate on savings in South Africa?
Capitec Bank Global One Savings Account: The Capitec Bank Global One Savings Account provides customers with an interest rate of up to 5.10%.
Where can I put my money to earn the most interest in South Africa?
African Bank has the best-fixed deposit rate for 2023, with a rate of 10.50%, followed by Capitec Bank and SA Retail Bonds, all with 10.00% and 9.75% interest rates respectively.