Top Pensioner Savings Account Rates

While pensioner bank accounts can often be quite similar to standard bank accounts, some banks and credit unions may offer a few additional benefits such as waiving fees or other perks for people over a certain age.

As you can see from the list above, many banks and credit unions offer accounts targeted at pensioners or seniors who may be looking for banking options to meet their specific needs.

There are a few different types of accounts pensioners or seniors may be interested in, but here we're referring to pensioners/seniors' savings accounts. (See at the bottom of this article for other accounts that may be confused for these.)

What is a pensioner savings account?

Pensioner savings accounts are designed for retired people aged over 55 or others receiving government pensions such as disability support payments, veteran's or carer's pensions.

Generally, pensioner savings accounts are designed to be simple and easy to use. They tend to offer the facilities of a standard transaction account but unlike many transaction accounts, will also pay interest on the balance in the account.

What's the difference between a pensioner account and an everyday account?

Combined account

A key difference between a pensioner savings accounts and your everyday, run-of-the-mill savings account is that pension accounts are generally a 'one account fits all'.

Unlike most savings accounts where you often need to open a linked transaction account to access your money, pensioner accounts generally allow unlimited access to your cash via a linked debit card and bill pay, the same as many standard transaction accounts, but will also pay interest (unlike many transaction accounts).

Most banks and other deposit-taking institutions require you to have separate savings and spending accounts, with a debit card attached only to your spending account.

Different interest calculation

The interest rate structure of a pensioner bank account may also be different. Many pensioner accounts will offer what's called a 'tiered' structure for paying interest.

This means interest is paid according to the balance in the account. For example, balances of less than $10,000 might pay 0.5% p.a., with the interest rate climbing along with the balance.

Essentially, this means the more money sitting in your account, the more interest you'll earn.

Lower interest rate

It's important to note though that pensioner bank accounts can often come with considerably lower interest rates than a standard savings account.

This needs to be considered if you're considering whether to open a standard savings account or a pensioner account.

Who offers pensioner savings accounts?

There are a number of banks that offer pensioner savings accounts, including the big four banks.

Generally, monthly account-keeping fees are waived but many may charge other fees depending on the services used. Each bank will set out its own features and terms and conditions.

Many smaller banks also offer specialist pensioner accounts that may offer more competitive interest rates and/or other add-on features.

You can use the comparison tools on the table above to compare the various accounts or ask your bank what it offers in terms of pensioner/senior accounts and other products and services.

Eligibility

Generally, you'll need to be an Australian resident over 55 and retired, or receiving a government pension. You'll likely need to provide a pension or Centrelink number and/or other ID to prove this.

Pros and cons of pensioner savings accounts

There are some considerations before opening a savings account specifically tailored to seniors or pensioners.

Pros

• Flexibility: You generally don't need to stress about transferring money from one account to another or making sure you have enough money in your transaction account for bill payments to be deducted automatically. All your money can be kept in one place and is easily accessible, which can make life easier.

• Waived fees: Many banks will waive any account keeping fees if you're opening a pensioner or seniors savings account. Be sure to check if this applies.

• Earn interest: If you don't want the hassle of constantly setting up term deposits to earn interest, having your money sitting in a pensioner savings account can be helpful. While you may not be earning as much interest as you could find elsewhere on the market, you also won't need to worry about moving money around or keeping track of term deposit end dates.

Cons

• Less choice: While the big four banks and a number of other banks offer pensioner savings accounts (or pensioner-geared products), not every bank does. You may find your current bank doesn't offer specialist seniors' products. Be sure to do your research to find a product suitable for you, or if sticking to a regular savings account might be better for you overall.

• Lower interest rates: Pensioner savings accounts generally pay lower interest rates than standard savings accounts, even at the same banks. Make sure you check whether you would be better off keeping your savings in a standard or high interest savings account with a traditional linked transaction account to pay your bills from.

• No bonus interest: Due to the nature of pensioner bank accounts, they don't typically offer bonus interest. Bonus interest can be earned on certain bank accounts on top of a base rate depending on whether the account holder meets certain conditions.

Other senior bank accounts

Retirement savings accounts

Pensioner or seniors savings accounts shouldn't be confused with retirement savings accounts. These are specialist accounts where account holders can contribute funds that can't be accessed until they retire, much like superannuation.

These types of accounts are guaranteed, which means account holders can't lose the money they put in there, but the returns are considerably lower than what superannuation funds can achieve.

Retirement savings accounts are offered by only three banks (as at 2024) while some banks are still maintaining past retirement savings accounts but are not opening them to new customers.

To make things a little more confusing, some banks may market some seniors savings accounts as 'retirement accounts'.

Make sure you understand what you are signing up for before opening any account.

Retirement income accounts

Superannuation funds may also offer 'retirement income accounts' when people choose to access their super through account-based pensions.

These accounts are set up through a superannuation accumulation account when a person has reached preservation age (between 55 and 60 years old, depending on when they were born).

Such accounts are a means of receiving regular - or lump sum - payments from the account holder's superannuation balance.

These accounts are also different to pensioner or senior savings accounts offered by some retail banks.