Currently use Squirrel, anyone else have any other suggestions? are they offering the highest rate atm for saving accounts specifically?
Highest Rate Savings Account?
P0KEMON on 29/06/2024 - 03:03
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yeah, but you have to use the ridiculous two-factor dongle to login. At lease with others, you can use your fingerprint.
No, you just set up the mobile app once and use a PIN that you set to log in. They are phasing out the authenticator soon anyway.
Zagga is similar to squirrel. So PTP lending. Not savings account as such though, more like term deposits. Terms can vary from a few months to 12. They are usually security backed loans in home improvements, building, commercial, bridging loans etc. Returns usually around 10% Minimum $1000. The loans usually fill quickly though and not always any available. None at the time of writing this.
Squirrel's on call account keeps money in a bank though, it's not P2P.
Be careful with anyone offering high returns. There is no free lunch out there. The higher the return, the higher the risk.
Yep, thats true. In the case of the Squirrel On-call Account, the money you store in there is deposited with two of NZ's main banks. So unless you think NZ's main banks are about to fall over, then you can earn more than what the banks are willing to pay you directly. So in this case, you're effectively getting a free lunch from the bank!
I was more referring to Squirrel's PTP lending.
I do agree though, the Squirrel On-call Account is a great option, and one of the best rates you will get for that level of (bank) risk, and withdraw speed.A free lunch isn't worth opening an account at a P2P lending company, i know you keep the on call account in the major banks but for people like me who don't even trust the smaller banks i certainly don't trust a P2P lender with my saving.
I'm not a old guy but when it comes to keep my hard earned money safe and earn the maximum return the banks have the lowest risks. Besides your website mentioned the interest rate of the on call account could change anytime.
@kyogui: Hi, no problem, we're really transparent with how we operate. If Squirrel's not for you, thats OK.
As an FYI, interest rates on bank savings accounts can change at any time also.
So Dosh's Strive account (aka Savings account) just went up to 5.10% interest today :). That would seem the most logical seen as it it literally a everyday bank account + debit card linked to it with 1% cashback on all eligible transactions.
Don't forget to use cheapies referral system if anyone signs up.
Isn't it better to stick with an actual bank?
The Dosh Strive is a bonus saver and paying lower interest, you're still better off with Squirrel product in my humble opinion.
Hi Dave, the Dosh Strive savings account is not a bonus saver. This is according to their own Intercom help page: https://intercom.help/dosh-nz/en/articles/8559424-earning-in…
Not really a good look saying that, then promoting your own product :(
Hi, thats my mistake, the Dosh product started out as a bonus saver product and must have changed recently. Squirrel product still pays 5.25% flat rate compared with Dosh at 5.10%.
@Dave from Squirrel: the net return post tax depends on personal circumstances. e.g. The PIE option via WestPac and Kiwibank at 4.5% (or Heartland bank at 4.6%) offers better net interest post tax vs Squirrel at 5.25% for those at the top tax rate.
Furthermore, kiwibank can easily transfer cash PIE and notice saver via internet banking.
Westpac can even do future payment/ transfer off cash PIE, (almost function like as a transaction account with good interest). (but can't do direct debit etc).Heartland is still an overnight bank as far as I know.
So Squirrel may not be a better product for some people depending on circumstances, so there are always room for improvement!
@gooddeals: Yep, thats fair, there is 0.04% in it with the PIE option at 4.50%. Squirrels after tax rate for a 39% tax payer is 3.20% v Westpac at 4.50% PIE 28% is 3.24%,. Note that we are comparing an account with a cash managed fund.
@Dave from Squirrel: Worth noting that both kiwibank and westpac etc cash pie (cash managed fund) just works like any other bank saving account with effectively the same security as standard bank saving account. They can make immediate transfer to their transaction account effectively without time lag. So effectively saving account at a lower tax rate. Unlike income fund by squirrel that has tangible increase in risk of default albeit very small but tangible difference nevertheless.
@gooddeals: Hi, the comparison in this thread is the Squirrel On-call Account v banks cash PIE's. The investment risk is virtually the same on these two products as they both invest into the banks balance sheets.
I think you've introduced the Squirrel Monthly Income Fund into the mix in your comment above. I agree with you that this has a different risk profile. I have not tried to make a comparison between our Fund and banks cash funds. Squirrels Monthly Income Fund invests in a pool of loans and is delivering a return of around 7.50% p.a. after fees and before tax. So it's in a different league to the On-call Account and cash PIEs.
@Dave from Squirrel: thanks, correct. but you seemed to have given the impression that the PIE cash funds are different from saving account, in a terminology sense it is different, but in the functional sense and risk sense is the same so comparable. While the comments you made are correct but could be easily misinterpreted. I wanted to highlight that the PIE funds (managed funds) come in many forms. there are lower risk products like saving accounts and cash PIE from banks and such cash pies are not available from Squirrel, but higher risk ones such as Squirrel's Monthly Income Fund. I would caution Squirrels Monthly Income Fund claiming a return of around 7.50% p.a. after fees and before tax, as this is not the target nor such return is not guaranteed in the forward sense like cash account/ term deposit etc. Noting that since inception it is returning only 6.23% per year and consistently not meeting the fund objective or benchmark plus 2%. given the expected fall in interest rate a 7.5% is less likely to be met in the coming year, albeit around 7.5% was delivered in the year to 31 May 2024.
https://www.squirrel.co.nz/media/4876/squirrel-monthly-incom…
ASB savings plus give you 5% if you make none or only one withdraw in the first 5 days of each calendar quarter.
https://www.asb.co.nz/bank-accounts/savings-plus.htmlLotsa rules with ASB's product … you'll earn more with Squirrel with a similar risk profile given the funds are stored at main banks. I reckon Squirrel's product is superior in all but one facet, if you bank with Squirrel it will take about 2hrs to get it back to your bank account, whereas if you bank ASB, you can get at it faster. Choose an old style product if you want but there are better products out there, like our Squirrel On-call Account.
ASB is rated with Standard & Poor's, Fitch, and Moody's. By what similar metric are institutions like Squirrel's financial health measured?
Hi, Squirrel does not have a credit rating. You can see our financials here if you wish: https://app.companiesoffice.govt.nz/companies/app/ui/pages/c…
We hold your cash via a trust account that is audited by KPMG each year, so money in the trust account remains your money and Squirrel is your custodian for those funds.
@Dave from Squirrel: A trust account in a bank? So that it's protected by the bank's assurance rather than Squirrel's?
@Slogan: Getting into the technicalities, customer funds are held by Squirrel P2P Trustee. This is the name on the bank accounts. Squirrel the company is the manager of the Squirrel P2P Trust, and we're acting as a custodian (and regulated as a custodian) to provide this service by the FMA (Financial Markets Authority).
Squirrel also has an independent Board in place and you can add the financial services expereince up across the Board and Senior Management team to over 150 years collectively.
When you use the word 'assurance', if you're referring to the investment risk, then there are two components:
1. Whats the credit risk of putting money in the banks we use? Both bannks are AA- rated by Standard and Poors, they're about as safe as you can get in a NZ sense.
2. The other risk to consider is that in the rather unlikely event that Squirrel was to go out of business, then a liquidator would be appointed to wind things up. Once they've verified everything is as it should be, they would make the funds available for customers to withdraw back to their bank accounts.
Say if you have $100,000 in ASB's savings plus you will get $5000 interest before taxes per year, and with squirrel's on call account you will only get an extra $250 per year before taxes is that correct?
Yes, that is correct!
Heartland's Digital Saver offers 5% (one free self service withdrawal per month, no monthly deposit required, no fee) and 32 day Notice Saver gives 5.5%.
https://www.heartland.co.nz/savings-and-deposits/digital-sav…So many rules with Heartland, and the time it takes their transactions to settle is crazy. With Squirrel, 2hr round trip (in and out) 7 days per week. No transaction or account fees, no minimum deposit each month, just a great interest rate.
I don't know why they take so long to settle. I thought they were meant to be speeding it up.
Make sure its a PIE as some above are not. Unless you RWT is less than 28%
https://www.interest.co.nz/saving/e-saver-online
Rabobank's PremiumSaver (if you add $50/m) gives the same as Squirrel 5.25%
You could also try use a Cash fund, like Kernels one, with a current yield of 6.06% (though does take a little longer to withdraw from, ~2-3 days)
https://kernelwealth.co.nz/funds/kernel-cash-plus-fund