The average savings account rate is a benchmark for the overall rate environment. But it’s not a rate that you should settle for.
You should aim for a high yield savings account that has an annual percentage yield (APY) many times the national average. This is because it’s easy to find a high-yield savings account that offers a competitive yield and no minimum balance requirement, or a low one.
National average savings account interest rate
The national average interest rate for savings accounts is 0.07 percent for the week of March 31, 2021, according to Bankrate’s weekly survey of institutions. Many online banks have savings rates higher than the national average. The higher the rate, the more savings account interest you’ll earn.
How we calculate the national average interest rate
Bankrate obtains rate information from the 10 largest banks and thrifts in 10 large U.S. markets. In the Bankrate.com national survey, our market analysis team gathers rates and/or yields on banking deposits. The survey has been conducted the same way for more than 30 years. This consistency means it gives an accurate national apples-to-apples comparison of rates.
Note: The APYs (Annual Percentage Yields) shown are as of March 31, 2021. Bankrate’s editorial team updates this information regularly, typically biweekly. APYs may have changed since they were last updated. The APYs for some products may vary by region.
Interest rates for linked checking and savings
Linking your savings account with a checking account is one way to earn a higher yield at some banks. This may be called a relationship rate. It’s more common for brick-and-mortar banks to offer these rates.
For instance, at Huntington Bank the non-relationship APY is 0.02 percent APY. But if you have a Huntington 25 checking account you’ll earn almost three times that APY, which is 0.05 percent APY. Having a checking account might not seem like a big commitment, but the Huntington 25 Checking account requires $25,000 in total relationship balances to waive the $25 monthly maintenance fee.
The combination of large amounts of money to avoid monthly fees and lower APYs from brick-and-mortar banks are why online banks are often a better choice for those looking to find the highest APY. Online banks tend to give a high APY across all balances. Some online banks have a minimum required to earn an APY. The majority of online banks have minimum opening requirements of $100 or less.
|Bank||Checking account/Savings account combo||Standard savings yield||Yield with relationship||Minimum checking balance to avoid a monthly fee|
|Huntington Bank||Huntington 25 Checking/Huntington Relationship Savings||0.02% APY||0.05% APY||Total relationship balance of $25,000 required.|
|Chase||Chase Premier Plus Checking/Chase Premier Savings||0.01%||up to 0.05% APY||Average beginning day balance of $15,000 in this account or qualifying investments and deposits.*|
*A linked qualifying mortgage can also waive the monthly fee on the Chase Premier Plus Checking account and make at least five customer-initiated transactions in a monthly statement period using your linked checking account.
Compare online banks with larger banks when you search for a high-yield account. You’re likely to find that online banks have lower minimum balances, won’t have monthly fees and they may pay the same APY on all balances. In many cases, this APY will be higher than a savings account at a brick-and-mortar bank.
Use the national average savings rate as your gauge. You should be able to easily find a bank that’s offering an APY multiple times higher than the national average.
Calculate the difference between the APY at a big bank compared with the yield at an online bank to see what higher interest earnings looks like. The power of compounding helps your interest earn interest over time.