Earn $500 in 20 minutes

By Lauren Leisk, Yahoo!7 Moneyhound Updated February 9, 2013, 8:00 am

Time is money.

Offer someone $500 to fill out a 20 minute questionnaire and they’ll jump at the chance.

But offer the same amount to fill out an online application form for a savings account, and they’ll put the task at the bottom of their priority list.

Yet in Australia, with our current interest rates (compared with rest of world), every $4,000 you save could earn you around $200. And it doesn’t stop there.

With regular automatic deposits from just $30 a day (the price of your daily breakfast, coffee and lunch), and interest compounding monthly, you could be close to $500 richer by the time Christmas rolls around this year.

Here's a quick break down of how your next 20 minutes could earn you money;

Basic bank accounts

Everyday basic transaction accounts (the ones that let you to pull cash out of an ATM) offer close to zero percent interest. Of course, we all need them to conduct our daily spends, but if there’s more money in your everyday account that you actually need, you could transfer the excess funds into a high interest savings account.

High interest saving accounts

These days we don’t need to visit our bank branches - most of our banking can be done online. For this reason, online savings accounts like these can offer up to 5% p.a. interest on any excess funds you have that don’t need to sit in your everyday account.

Furthermore, many these high rate accounts like the ING Savings Maximser do not have to be with the same banking institution as your everyday transaction account. With the two accounts linked (even from different institutions) it only takes overnight for funds to be transferred from one to the other, allowing you to get the cash from an ATM the next day if you really need it.

Some of them do require your everyday account and your savings account to be with the same institution like the ANZ Online Saver, and doing this will not only secure a higher savings interest rate but also allow you to transfer and access the funds immediately.

These high rate accounts accumulate interest daily, and pay the interest to you monthly, which means cumulative interest is being calculated over time (earning interest on the interest). And the best part is these accounts are totally FREE to own. Yep that’s right, the bank pays you for keeping your money with them, and charges you nothing for it.

Calculate

If you give yourself a savings goal: an overseas holiday, a renovation, a wedding, then by using our Moneyhound Help me Save calculator (at the bottom of this page click on the right of the widget) it’s easy to see how and by when your financial goals can be met.

Here’s an example:

By saving $1000 each month on an initial deposit of $3000, with an interest rate of 5.2% p.a. paid monthly, in just two years you’ll have more than $28,000

Having a goal is important, and knowing you’re earning extra interest for every dollar you squirrel away is added incentive to stay on track and stop yourself from pulling that cash out when you find an excuse to spend it.

Compare

Below is a table of some of the highest rate accounts in the market (as at 07.02.2013)