Last week it was confirmed what we all knew - that prices are up.

The headline consumer price index came in at 4.5 per cent for the year to June - the biggest jump in 12 years and a whopping figure when you consider the Reserve Bank of Australia is mandated to keep it between 2 and 3 per cent.

However, the biggest culprit was not, as you might expect, fuel, but deposit and loan facilities. Rising 9.5 per cent during the quarter, this measure takes into account bank fees, as well as the difference between the interest rate banks charge borrowers and the rate they pay savers.

We all know that, with banks' costs of borrowing increasing thanks to the credit crunch, they have been extremely quick to raise rates on loans - whether passing on an official increase or not. But they have also been tardy to lift the rates they pay on deposits.

In fact, while in the previous quarters borrowers with a standard variable rate loan could expect to pay 2.2 percentage points more than savers into at-call deposit accounts, that margin is now 2.6 percentage points.

Figures from data house Cannex show that interest rates on loans have risen twice as much as rates on savings, at an average of 1.5 percentage points as opposed to 0.8 of a percentage point.

How do you claw back some of the CPI increase on deposits and loans, both from a fee and interest rate perspective? First, do all you can to minimise fees - both scheduled fees, such as annual and monthly account-keeping fees, and charges that emanate from your own actions, such as dishonour and early exit penalties.

With the former, choose accounts and loans facilities with the most competitive cost structures; with the latter, be cost canny.

So if you are what's called a frequent transactor, don't use an account that gives you a limited number of free transactions and charges each time you go above that. An all-you-can-eat account, with one monthly fee for all the transactions, will suit you better.

Then keep a close watch on your account inflows and outflows, and set up automatic transfers to minimise the risk of being caught out with a dishonour fee.

And, whatever you do, check the exit penalties. While this is the last thing most people think about when signing up, if you need to bail out early, these can be eye-wateringly large - even larger, says a recent ASIC review, than in Britain and America. The report found that exit fees, including the euphemistically named deferred establishment fees levied if you pay out a home loan within the first five years, can be more than $7500 on a $250,000 loan.

So how do you combat banks that are happy to punish borrowers but reluctant to reward savers? By becoming a rate tart and blithely switching to better offers.

Smaller institutions such as credit union mecu are charging 8.55 per cent on flexible home loans. That's a far cry from the almost 10 per cent big-bank rate. And BankWest is paying a phenomenal 8.5 per cent on savings for a limited period of time. (See http://www.infochoice.com.au for more rates.)

Yes, sign up to these two top products and, far from suffering the average 2.6 percentage point, CPI-driving interest rate differential, you will earn almost as much as you pay.

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