Wondering how to make money from your savings? I have three suggestions

March 15, 2026 — 5:01am

One of the interesting things about working in the finance field is that you quickly learn no matter how many things can change in the world, when it comes to money, some things always stay the same.

That’s especially true when it comes to the common questions people ask for advice on. And one issue that has been popping up in my DMs on social media, and being sent into my podcast a lot lately, is what to do with savings right now.

These savings are not your emergency fund, savings put away for future holidays or other short-term goals, either. This is money that is simply sitting in your account that you’re not yet sure what to do with.

It could be an amount you’ve been carefully squirrelling away, or you’ve been lucky enough to come into a lump sum. Whatever the case, knowing what to do when the time comes is important because the quicker you make the decision, the quicker your money will start working for you.

We all know that the most important thing for your money is time, and a dollar today invested is worth a lot more than a dollar invested in 20 years.

So, should you be paying down your mortgage as quickly as possible while interest rates are high? Is a high-interest savings account the safest option while global markets are volatile, or does that make it the perfect time to invest?

Whatever you choose to do, your money will be hard at work and helping you get one step closer every day to your long-term money goals.

At the risk of sounding like a broken record, it’s important to say that there is no one-size-fits-all, right or wrong approach when it comes to what you want to do.

That’s why the first thing you need to do is think about three things: what are your money goals, what are you comfortable with, and how long have you got before you’re likely to want to access your savings.

With those parameters in mind, let’s map out some options using $50,000 as an example.

1. A high-interest savings account

The most obvious pro of putting your savings into a high-interest account is that should you ever need it at short notice, you will be able to access it.

If you’ve got a few years until your children enter high school or university, are planning to buy a property, you’re near retirement age or want to help a loved one out in the next five or so years, this can be a great option.

But there are a few cons to this option too. Firstly, with most high-interest accounts in Australia offering roughly 5 per cent interest, your annual return will be relatively modest at $2500.

You’ll also have to pay tax on any interest earned, and some accounts have strict terms and conditions in exchange for the higher interest rate, like making a minimum contribution each month or not accessing the account for a set period of time.

2. A mortgage offset account

Much like a savings account, the pro of having your money in an offset account is that it can be accessed quickly and easily if you need it.

Another pro is that – depending on your mortgage rate – the return is likely to be greater. Let’s say you have a rate of 6 per cent, which is about the average after the most recent interest rate rise handed down by the RBA.

In an offset account, that $50,000 will save you $3000 of interest each year. And unlike the high-interest account option, there’s no payable tax because technically, you’re just saving money from an existing debt rather than accruing new savings.

The two main cons for this option are that, firstly, you need to have a mortgage to enjoy the benefits of an offset – and not everybody does – and the return is likely to be lower than if you invested in the sharemarket.

3. The sharemarket

This option has the most pros and the most cons, but all are critical to consider and factor in when you’re deciding.

Currently, the global sharemarket is doing some incredible dipping and rising. Take this week as an example: on Monday morning, the Australian and US sharemarkets declined by 4.1 per cent, or more than $110 billion.

By the close of day this had gotten a little better and the S&P/ASX had clawed its losses back to only 2.9 per cent. By Tuesday morning things were looking up again, with the S&P/ASX rising 1.6 per cent. On Wednesday, it was up 0.6 per cent again. Then cut to Thursday, and it fell 1.3 per cent, a loss of $35 billion.

I’m laying all of this out not to put you off, but to ensure you’re informed. Experts across the board acknowledge that the sharemarket is particularly volatile right now due to a range of factors.

For some people, especially those who don’t have a lot of time or are particularly risk-averse and likely to feel stressed out, the rollercoaster is a con.

But if you have a good amount of time to set and forget your savings, this can be a great option because putting the daily ups and downs aside, the average rate of return is about 10 per cent.

This equates to $5000 of that $50,000 in savings and if you left it there for a decade, you’d come back to find about $135,000 waiting for you. However, just like the high-interest savings option, you will have to pay tax on any income you make.

At the end of the day, any strategy you choose should be one that works for you. It should help you achieve your goals, work to the timeframe you have and not bring unnecessary stress into your life.

Though the right answer might be different for everyone, the one common denominator is that whatever you choose to do, your money will be hard at work and helping you get one step closer every day to your long-term money goals.

Victoria Devine is an award-winning retired financial adviser, a bestselling author and host of Australia’s No.1 finance podcast, She’s on the Money. She is also founder and director of Zella Money.

• Advice given in this article is general in nature and is not intended to influence readers’ decisions about investing or financial products. They should always seek their own professional advice that takes into account their personal circumstances before making any financial decisions.

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