Comparison of Interest Rates for Savings Accounts, Time Deposits, and Government Bonds | Explaining the Outlook 3 Years from Now

If you buy government bonds now, will savings accounts overtake them? The golden rule of investment to avoid failure during a rate hike cycle
[2026 Latest] Current state of bank interest rates and government bond yields | Comparison with one year ago and future forecasts

1. Current interest rates and future forecasts (Summary list)

Mega bank savings account interest rates

• Current (November 2026): Annual 0.50%

• Change from one year ago: It has increased 5-fold from 0.10% a year ago.

• Forecast for 3 years from now (around 2029): Annual around 0.80% to 1.20% is expected.

Mega bank time deposit interest rates (1 year)

• Current (November 2026): Annual around 0.60% to 0.80%

• Change from one year ago: It has increased by up to about 3-fold from 0.25% a year ago.

• Forecast for 3 years from now (around 2029): Annual around 1.20% to 1.80% is expected.

Interest rate for individual government bonds (10-year floating rate)

• Current (November 2026): Annual 1.85% (Initial applicable interest rate)

• Change from one year ago: It has risen significantly from 1.10% a year ago.

• 3-year forecast (around 2029): It is expected to rise to about 2.20% to 2.70% per year.

[Indicator] Yield on newly issued 10-year government bonds

• Current (November 2026): About 2.6% to 2.8%

• Change from one year ago: It has more than doubled from around 1.1% a year ago.

• 3-year forecast (around 2029): It is expected to reach about 3.0% to 3.5% per year.

2. Conclusion: “Will government bonds be outperformed by savings accounts?”
The result depends entirely on the type of government bond you purchase.

• If you choose “Floating-Rate 10-Year Bonds,” there is almost zero risk of being outperformed by a savings account.

  • The interest rate is automatically adjusted every six months based on “10-year government bond yield × 0.66.”

  • Since the bond’s interest rate will rise along with market interest rates (savings account rates) in the future, you can always maintain a higher yield than a savings account.

• Choosing ‘Fixed 3-Year or 5-Year’ carries the risk of being outperformed later

  • Because the interest rate is fixed at the time of purchase, if interest rates on savings accounts or time deposits rise in 3 to 5 years, you may be outperformed in the latter half of the term.

3. Investment Rules to Avoid Failure (2 Ironclad Rules)

1. The only choice for product selection is ‘Individual Government Bonds (Floating 10-Year)’ This is the best strategy to fully benefit from rising interest rates while maintaining principal protection during a period of rate hikes.

2. Buy with ‘surplus funds’ that you will not need for at least 1 to 2 years You cannot redeem the bonds within the first year of purchase, and even after one year, the ‘most recent year’s worth of interest’ will be deducted upon redemption. If you redeem early, your actual interest earnings will decrease, potentially resulting in a worse outcome than if you had simply left the money in a savings account.

Final Conclusion

If you want to avoid principal loss while safely growing your money by riding the wave of future interest rate hikes, buying ‘Individual Government Bonds (Floating 10-Year)’ and leaving them for at least a year is the smartest option.

#Failure#Redemption#Forecast#RateHike#Interest#TimeDeposit#Yield#GovernmentBond#IndividualGovernmentBond#InterestRate