Where Do You Keep Your Savings?

Everyone on ozbargain is rich right? Assuming you have savings, or are able to save, where are you keeping your money?

I just ask because I was surprised with this thread (https://www.ozbargain.com.au/node/588041) how many people actually keep their savings at the bank.

Long term this sounds like the worst strategy to grow your wealth.
- you don't get a great interest rate (especially right now)
- what they give you, you get taxed as if it was income
- the amount you get back is barely enough to keep up with inflation.

Basically, the Australian government really doesn't want people saving money and it shows in their taxation treatment.

Unless we're talking a grand or two for a rainy day fund or for something I'll need very soon, I can't really see any reason where I'd put the money in a savings account. There's lots of other options out there although there's obviously upsides and downsides to them.

So for you rich people with savings, where do you keep them?

Poll Options

  • 202
    Savings account
  • 425
    Mortgage offset
  • 89
  • 41
    Shares (for those who like to gamble)
  • 7
    Investment property
  • 30
  • 32
    High yield investment automobile
  • 14
    Something else
  • 38
    I have no savings


            • @modiika: And for most of those emergency situations you can have a credit card - and then repay it from your bank at the end of the month.

              • @macrocephalic: Agree. For me its more about ensuring, that even if I lose my job (which in my industry can take months to find a new one) that theres coverage and i'm not racking up interest on a CC. But yeah, I think a credit card is a great emergency option, that some financial people get snobby about.

    • Why do you her an emergency fund when you have an offset?

      Doesn't an offset offer the same level of liquidity?

      • Might depend on who their mortage is with and how reliable they think the mortgage holder is for returning their offset in an emergency. Some of the cheaper ones do fake offsets, which are basically just redraw facilities.

        Personally, i have multiple offset accounts, and one of them i think of as emergency, and then others I use to save for medium term luxury expenses, like clothes, gifts, travel, then once those accounts are full, i pay down the mortgage more, or occasionally top up on etfs or something else.


    Blackjack double or nothing

  • Bitcoin. All moved there since the last halving.

  • Under my bed

  • It's not really savings anymore if you're moving it to an investment. Risk of your money losing significant value plus illiquidity. Outside of parking in an offset account, there's not really anything other than a bank account or under your mattress that counts as savings.

    If you're asking why people don't invest, or how they invest, that's a very different question. It'd be more interesting to discuss 'if you have significant savings beyond an emergency fund, why?'

    • The savings are being converted from one store of value to another store of value. The former is guaranteed to lose its value over time while the other have an asymmetric potential to gain x value over the same time.

      • Yes, but like I said already, investments are not 'savings'. Saving implies ability to use as a need comes up, using the amount you have saved. Investments are prone to risks that can leave you with less money than you started, and are much less liquid, thereby negating their suitability to use as savings.

        If we're talking investments, let's talk investments.

    • Savings are part of a healthy diverse portfolio. It bring stability (as distinct from volatility), security (for emergencies), and options (if a good opportunity comes along). That helps with peace of mind, particularly in these troubled times

  • Gold & silver bullion, for when everyone works out why interest rates are zero.

    • Then what do you think will happen and why will gold/Silver increase value?

      • Because currencies are pegged against Gold and we're busy printing lots of money, rapidly devaluing currencies.

        • The USD was taken of the gold standard in 1971 by R. Nixon.

          • @whooah1979: Yeah, Nixon didn't unpeg the social construct.

            Gold has limited availability unlike paper currency that could be printed at will. People know this, and this why Gold has been holding its value, and will continue to hold its value.

            Warren Buffett invested big time in Gold recently, and I'd like to remind that he knows a thing or two about investing money.

        • What about when people realise that gold and silver are of limited value outside of use as a currency? The US has been doing QE on and off for a decade with almost no long term change in their currency value.

      • Another thing that I need to point out us that Gold isn't an "investment". It's just going to hold its value against inflation.

    • An irrational state can last a long time. You can have a person born in it and die in it before the inevitable correction takes place.
      Rome might have fallen eventually, but it still took more than 100 years to happen

  • Basically everything you tabulate is an expenditure or gambol apart from placing ones money in the bank which is govt guaranteed

    • Agree. Most people I know with investments own very little and their investments are looking crap. Know someone who out a ton of money in Bitcoin (online Monopoly money) as well. Personally not worth the risk.

      Go to work, get paid, put it in the bank until you have enough to buy what you need/want. Rinse and repeat. I don't have any long term valuable assets but if I ever lost my job or went bankrupt I have a shit tonne of personal items to keep me happy.

    • But to be clear everything is a gamble. What matters is what you're risking and what the reward is.

      Even cash is a gamble because whilst the money is guaranteed by the government, the value of the money isn't. In that there's no guarantee that $10 tomorrow will buy the same things as $10 today.

      In fact, given real interest rates are negative, the risk of your savings account losing value is a near certainty, with the only reward being you definitely won't lose it all at once (barring some major Argentina peso style currency crisis on the aud).

      Now for some people that's exactly what they're after. Personally I think long term, there's much better ways to keep your money but everyone's situation is different. The point is though that one should not assume any asset class contains no risk.

  • Can we have a poll option for a mix?

  • Sitting with cash at the moment. Already paid off my property.
    There will be a big correction sometime in the near future in shares and property.

    Patience is a virtue and will wait for that correction

    • So the recent ~40% drop in All Ords wasn’t big enough for you? Seemed like a correction coinciding with Covid to me and glad I’ve put my cash to work.

      • Crashes are the best time to accumulate more assets. Once every five to seven years is always good.

    • There already was a big correction in the recent past.

    • I asked my colleague back in March 2020 (a barefoot subscriber), what are you waiting for? He said for at least a 50% drop. Never happened.

      DOW & S&P 500 - now at new highs.
      ASX - now close to pre-covid levels.

      gg noobs, keep waiting then…

      My advice is to set a fixed asset allocation strategy based on your tolerance to drawdowns and follow it through ups and downs.

      • While I agree with the fact that expecting a 50% drop is probably a long shot, you need to understand that those markets are partly at those "new highs" because of the liquidity that's been infused by way of printing money.

        • Yup, not denying that is the cause, not complaining either.

          Governments around the world fear the evil "R" & "D" (recession/depression) words that they usually do whatever it takes to keep their countries out of it. The usual solution to this is lowering interest rates, QE and money printing to try and keep inflation positive.

          Unfortunately, because of this, the poor and financially uneducated are usually the ones that suffer the most as a result of decreased purchasing power.

      • I wish I'd taken money from my offset to put into VAS in the middle of the year, but, there's almost never a better time to invest than right now. All the time that you're waiting for a drop is time that you're missing the regular gains.

      • He said for at least a 50% drop. Never happened.

        It is the problem with some people and their hard rules.

        20% is correction territory, start dropping fixed amounts in every 5% it goes down further. You will never catch rock bottom but you are likely to average very close to it.

    • if you had not noticed there was atready a massive correction in share price in march. Was a great time to score some bargain shares. Property is to much of a gamble for me at the moment, could go in any direction or even just stagnate for a decade.

    • I bought truckload of gold stocks in april and did nothing after that. Now sitting at pure 65% returns.

      I could have earned more had I flipped the stonks but being lazy ending up with 65, I love that.

      Stock market pays out for humble and honest opinionated investments - every time. Up and down is the pattern.

    • Like those poor bastards still waiting for a housing crash since 2000 yeah. You think the bus is still coming when it’s actually long gone.

  • Shares mean you're gambling? Right. And what exactly do you know about shares? That it's used to make a quick buck? Yes? Thought so.

  • Crypto

  • crypto easily

  • Where's the option of 'Discounted Gift Cards'?

  • Good try bikes

  • Investment property and shares for me. Passive income; letting my money do the work for me.

    • That's well and good, but returns for investment property is pretty bad compared to Bitcoin or even shares for that matter.

      I don't understand this property delusion.

      • The returns for property may not be as high, but you can be much more highly geared than shares.

        In some cases, you can borrow 105% if you want to, and still avoid mortgage insurance by using your PPOR as guarantor. Plus you'll be paying 2.5% - 3% interest on that too. Depending on the area, that would be close to the expected net yield so you're basically positively geared right off the bat.

        It's not for everyone - it's not totally hands off, and it's a lot of money to borrow, high transaction costs etc. But it does have its upsides.

        • I calculated all of that. Property investing still came out second to shares and Bitcoin.

          Just because you can highly leverage, doesn't make it a good investment. The problem with property is high transaction costs as well as the high maintenance costs (council fees, land tax, strata if unit etc), unless the price keeps going up, you are losing money, and that's the issue. Can you realistically expect property prices to perpetually go up? It hasn't, this is a big reality check for people. They rush in without actually doing the calculations.

          I've taken everything into account to create a model for various investment options, shares, index funds, property and bitcoin and property investing just doesn't make sense to me, there are much better investments out there.

          • @techlead: well I haven't seen your model but I think it's pretty hard to make any meaningful projections without looking at the characteristics of the specific property, share or coin. And everyone's situation is different - there isn't a one size fits all investment strategy that is right for everyone.

            "Can you realistically expect property prices to perpetually go up?"

            That's an interesting question that you asked… I have a feeling that is something we are going to disagree on. Because my answer would be that yes I would expect them to go up. Given a long enough horizon (15-20 years), I can't see how every house in every major city wouldn't increase in value. Just as I'd expect rents, incomes, costs etc also to go up. Just as I'd expect ASX200 to have a near certainty of going up also.

            I mean everything has risks - there's no certainty but if I had to make a prediction - yes I would expect house prices to go up in 20 years. Geniunely though I'd be interested to hear what your prediction is. Do you expect house prices to eventually just level out? Do you expect them to plummet? Would it be caused by any major event or just the way the system is designed, it's heading for collapse?

            • @witsa: In nominal terms, yes, property will continue to perpetually go up, same goes for every other asset. This is due to inflation and all the QE/money printing central banks are doing around the world.

              The question becomes, how much will property increase relative to other investments, eg shares and Bitcoin. I'm investment agnostic, I don't care which investment vehicle I'm in, I just want to get more money in real terms not in nominal terms due to inflation.

              Property prices is a function of availability of credit, propensity for people to borrow and wage growth (serviceability). We know the government is throwing everything including the kitchen sink to prop up property prices, so I don't expect the availability of credit to decrease, I expect it to become easier and people's willingness to take on more and more debt will not go down. The big sticking point would be wage growth, its been stubbornly low.

              In the short term, I don't expect something like the boom markets in 2015-2017 which is fueled purely by debt and people's willingness to borrow more. This was only a sugar high, it was not sustainable. This sugar hit pushed prices way beyond wage growth which means fundamentally, I would expect prices to drop and it has been dropping and plateauing since 2017. I think property prices may be pushed up due to the proposed changes to stamp duty in NSW in the short term, but as an investment, it will not be superior to returns of Bitcoin. I doubt the property prices will collapse, the government will not allow that to happen. Sooner or later though, if wage growth doesn't pick up, it will start to stagnant again.

              If you had a time machine which allowed you to go back 10 years, would you buy property? I certainly wouldn't, I'd buy as much Bitcoin as I can. (I'm not greedy, I could have said some obscure altcoin which had an even bigger parabolic rise, but Bitcoin gains will do haha). I know past performance is not indicative of future performance, but it can be a guide. Bottom line is, property investment was not the best investment over the last 10 years (this is demonstrably true and undisputed), and I think property investment will also not be the best investment for the next 10 year either.

              Buying to live in, is a totally different story, I bought to live in, I see the value in that. My crypto portfolio can buy most houses outright, but I choose not to, why liquidate an asset which is making so much more gains to invest it into property?

              • @techlead: yeah fair enough thanks for your thoughts. They make a lot of sense.

                But I still think property has its place. Bitcoin and property are for entirely different investors. Not everyone is interested in short term speculations. Some people just want to make sure they have some money for retirement and property can be a pretty safe vehicle for that.

                Which touches on the risk aspect. Not everyone's risk appetite is like yours either. Probably another thing we are going to disagree on, but bitcoin IS a high risk investment. Whereas property will likely do better in 20 years time, bitcoin wasn't even around 20 years ago. Past performance is definitely a terrible indicator of future performance in this case. Not just because the time frame is too short but because we're talking about one product in an emerging technology. It's like looking at the growth of the iphone in the last 10 years and assuming it will sustain that growth over the next 10.

                There are so many factors at play which could cause the success or failure of bitcoin. There could be economic conditions, regulatory changes, environmental concerns, technological disruption etc.

                I'm not saying you shouldn't believe bitcoin can and will be successful. You might win big or lose win - only time will tell - but it's a speculative play. You can't expect everyone to be comfortable with this level of risk.

                • @witsa: I agree Bitcoin is riskier, however that is changing. Companies are using Bitcoin as a reserve asset now, like MicroStrategy which spent $475 mil buying it, it's now worth $766 mil now.

                • @witsa: Some good points but it is not fair to compare property to something as binary as crypto. Property is easy to understand and also a forced saving for many.

                  • @negger: The concept of 0 and 1 is taught in kindy.

                    A lot of people don't understand the difference between the cash rate, interest rate and why lenders can charge more and sometimes increase their rates while the RBA is slashing the cash rate.

      • Bitcoin is a massive gamble, you can lose more on bitcoin overnight than you can on a property in 5 bad years. It is all a bit of a risk but I am not sure how you can say property is delusion with a straight face while pushing Bitcoin.

        • You can also gain more in Bitcoin overnight than on property over 5 good years. Don't just see the downside lol.

          If you understand the fundamentals, then you'd know. I've seen a few cycles of Bitcoin from when it was only $50USD. I only started buying when it was $500USD.

          Also, you haven't "lost" anything until you sell. So when Bitcoin went down to less than $5000USD briefly earlier this year, I just bought more. That was amazing, it was a no-brainer, I was buying as much as I can during that dip.

          • @techlead: That is the problem, there are no fundamentals for bitcoin. It is all based on speculation, it has no underlining intrinsic value and isn't even useful as what it was originally created as (currency), it is purely a speculative store of value engine, as such it could shoot to the moon overnight or become worth Zero.

            • @gromit: People see what they want to see. Investors recognise that digital assets can have a value beyond 0 and 1 while haters will do what they always do from the sideline.

            • @gromit: The value of Bitcoin is in its network. That's like saying Mastercard and Visa networks have no value, they just facilitate the flow of money.

              Bitcoin facilitates the flow of value, it is a censorship resistant network. No court or government can ever confiscate your Bitcoins, you have full control of your money. What other asset has that quality? That has value. Governments can try to ban it, but it doesn't matter the network is still available for anyone who wants to use it. Millions can be transferred for a few cents if the network is congested, what other network can facilitate cross border transfers like this?

              How much value? That's the speculation part. There's speculation in any investment, whether it be properties, commodities, shares etc etc.

              • @techlead: Visa and Mastercard have value as they facilitate transactions. Bitcoin network has the potential to do that…poorly, but it is actually used as a store of value rather than for transactions at this point. It is also centralized, despite the promises Bitcoin is operating at the Whim of the chinese government at this point in time as more than 80% of miners are located their giving the chinese government the potential power to control bitcoin whenever they wish.

                properties, commodities and shares all have an underlying value of the assets they represent, Bitcoin has no asset it represents. Don't get me wrong I think their is a lot of potential to make a lot of money from it, there is also a lot of potential to lose everything as it has no intrinsic value and does not represent any real asset.

                • @gromit:

                  more than 80% of miners are located their giving the chinese government the potential power to control bitcoin whenever they wish.

                  There seems to be some confusion here.

                  It's estimated that ~80% of the BTC mining pools are located in 🇨🇳. It's true that the 🇨🇳 government can control the pools, nodes, people, buildings and the electricity infrastructure that powers that part of the network within their jurisdiction.

                  The nodes connected to the mining pools are located all over the world. These nodes are free to connect to any pool they want. This notice https://pbs.twimg.com/media/EoFah-4VoAUIsVw?format=jpg&name=... was issued by the 🇨🇳 government not long ago in an effort to disrupt the network. However, the order didn't impact the overall hash rate of the network. https://www.coinwarz.com/mining/bitcoin/hashrate-chart

                  The 🇨🇳 government trying to shut down the pools in their jurisdiction is actually a good thing for the other pools. The pools that are not located in 🇨🇳 will benefit by getting more of the block rewards.

              • @techlead: actually, the biggest problem with bitcoin IS its network. Being one of the first cryptocurrencies, it's just not built to scale. There's the incredibly wasteful proof of work algorithm, network-wide maximum transactions per second and confirmation time measured in minutes and hours. The network is never going to scale in a world moving towards more and more quick micro-transactions.

                And these days, bitcoin is absolutely regulated. Sure, you can go and mine your own bitcoin or you can go off grid and buy and sell it off some dude in an alley somewhere. But the moment you want to use any bitcoin infrastructure - to transact it on an exchange, you're required to give them your details.

  • Gave all mine to ATO when they called me to tell me there was an arrest warrant out in my name

  • Cash is trash and you will lose money holding cash against CPI.

    Federal reserves around the world pumping stimulus and lowest interest rates ever, if you haven't cashed in big already on shares/crypto than you have missed alot. This November was the best November for the Dow Jones since 1920. Myself and many others have made huge gains, don't know what people were waiting for, if you were on the sidelines and didn't get in during the March lows then you will never get in

    • yep, stop holding fiat, money is being printed non-stop, it really doesn't make sense.

      This is why Bitcoin has exploded.

      I try to hold as little cash possible. Unfortunately, most people are not financially literate to understand, they think $1 is $1 forever haha. Fiat money is only valuable because of its buying power. Consider this scenario, if a loaf of bread is $0.50 and you have $20. If that loaf of bread becomes $1 and you still have $20, it means you've lost money.

      • +1 vote

        "Consider this scenario, if a loaf of bread is $0.50 and you have $20. If that loaf of bread becomes $1 and you still have $20, it means you've lost money."

        Consider this scenario. If a loaf of bread is .01 bitcoins and you have .1 bitcoins. If that loaf of bread becomes .02 bitcoins and you still have .1 bitcoins, it means you've lost money

        • Very true.

          However your scenario with Bitcoin isn't aligned with reality.

          In fact I have a real world example, I paid for some webhosting fees with Bitcoin back when it was only around $3000USD, cost me 0.085BTC. I should not have done that and I haven't ever since, I should have just paid with fiat. I've lost money paying with BTC.

          So a more realistic scenario would be, a loaf of bread is 0.1 Bitcoin and I have 1 Bitcoin. If that loaf of bread then drops to 0.01BTC, I've lost money, T_T.

    • Yep, I made more on my ETF's in November than I did working. I didn't have the liquid cash to get in earlier in the year, unfortunately.

  • Side track - I'm considering on investing in NDIS SDA property in Brisbane. Does anyone have experience with this, positive or negative ?

    More information this program:


  • I lend it out to family members.

  • Spent it on a fine

  • Shares (for those who like to gamble)


    How are shares for "those who like to gamble"? If you're talking about stock options or other derivatives then maybe, but shares? They're pretty low risk.

    Basically, the Australian government really doesn't want people saving money and it shows in their taxation treatment.

    Yes, it takes a genius to figure out that when you're in an economic crisis and interest rates are at record lows, both monetary and fiscal policy are pushing people to invest and consume. You learn this in about the third week of a first year macro course.

    • Shares are high risk though, they aren't savings

      • Shares have some risk, but a diversified portfolio (which you can do with a single trade) has little risk. We had a global pandemic which made half the world grind to a halt for months and the ASX dropped about 40% from the highest to lowest point - and it rebounded half way back within a few months. If one of the worst case scenarios is losing 40%, on paper, for a few months, then it's a pretty low risk. As others have pointed out, you're guaranteed to lose money slowly if you have money with a bank.

  • no bikie investment option

  • In junk food. Must have thousands of dollars worth in my by now.

  • This year I invested in pumpkins. They've been going up the whole month of October, and I've got a feeling they're going to peak right around January and BANG! That's when I'll cash in!

  • +1 vote

    Where Do You Keep Your Savings?

    I keep mine buried right here…

    Why do you want to know?

  • I selected "other" because I have a managed funds investment with my financial advisor. I also have a margin loan to boost my investment. It's similar to super but I can sell/withdraw whenever I need to but it's set up so I can afford to change cars every 10 years and pay cash. It's also set up to add to my retirement fund.

  • +1 vote

    Keep some offshore so the ATO can't get their grubby hands on it.

  • Shares and offset.

    Offset for the guaranteed savings, shares to diversify.
    Bought during the March/April lows and they’re doing ok.

  • Everywhere. Stocks, crypto, real estate, gold and cash for loan offset. Like to diversify my investments.

  • OP - aside from the risk averse who just keep 100% or close to it in cash/savings people also keep a % of their net wealth as cash/savings for

    • potential capital raising (for those invested in individual shares)
    • take advantage of market downturn or opportunities (property, shares or other investments)

    you cant ever be 100% bull as then you will have no firepower when opportunity arises (either market wide or with specific shares/investments)

    first mistake is to assume when people talk about their savings accounts or interest bearing accounts this is the totality of their investments. it could be just their dry powder

    • True - everyone needs some percentage of their wealth in something stable and liquid. Unfortunately there was no way to put in a multiple choice poll.

      But it does seem like from the poll that most people on here are the 100% savings type. The vast majority have their money in savings or in an offset account. I guess we're all a very conservative bunch and people's PPOR is likely their only long term investment.

      Makes sense I guess. Most people's goals are to buy and then eventually own their own home so prior to that, people aren't really thinking too much about other investment goals.

  • Metal bullion and a savings account for money I may need to access fast.

  • Mine is all in savings because I might be moving country any moment now…and will need cash to buy a house. Just not comfortable with riskier vehicles at the moment.

  • The Ozbargain community is older than I thought.

  • +1 vote

    Emergency fund in a bank (~3mo expenses), rest goes into ETFs.

    Keep it simple, can't really go wrong in the long term (of course, it can… but it's highly unlikely). Any spare savings into more high risk shares.

    Short term savings are just in the regular bank account. I.e. things I'm saving to buy. Not sure it's worth putting that cash elsewhere if it's gonna be spent in less than ~12mo.

  • Offset until it has the full amount of the mortgage, then will start going into savings for another mortgage and also look at managed funds etc.