It doesn’t matter if you’re working class or very wealthy — everyone needs an emergency fund. And there’s no better place to park the money you’re saving than in a high-interest savings account.
High-yield savings accounts are used for emergency funds and storing savings for future events. They pay a yield that’s higher than average, allowing savers to reach their financial goals faster. CDs are deposit accounts that tend to pay higher yields than traditional savings and money market accounts.
The average savings account pays 0.07 percent annual percentage yield (APY). Many of the country's biggest banks pay less than that.
Sick of earning a yield around that average? Consider making a change and you'll find yields about seven times higher at some online banks. Compare rates among today's best widely available, high-interest savings accounts to find the right account for you.
Bankrate has more than four decades of experience in financial publishing, so you know you’re getting information you can trust. Bankrate was born in 1976 as “Bank Rate Monitor,” a print publisher for the banking industry and has been online since 1996. Hundreds of top publications rely on Bankrate. Outlets such as The Wall Street Journal, USA Today, The New York Times, CNBC and Bloomberg depend on Bankrate as the trusted source of financial rates and information.
Bankrate’s editorial team regularly surveys around 70 widely available financial institutions, made up of the biggest banks and credit unions, as well as a number of popular online banks. To find the best savings accounts, our editorial team analyzes various factors, such as: APY, minimum balance requirements and broad availability. All of the accounts below are insured by the FDIC at banks or by the National Credit Union Share Insurance Fund at NCUA credit unions.
Note: The APYs (Annual Percentage Yields) shown are as of April 1, 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.
High-yield savings accounts are a type of deposit account that can be found at both online and brick-and-mortar institutions. These financial tools typically pay a higher interest rate than traditional savings accounts and almost always offer better returns than traditional checking accounts.
But it’s not just higher interest rates that set high-yield savings accounts apart from other savings products.
Here are just a couple of the biggest financial benefits of high-yield savings accounts:
Like traditional savings products, safety is a mainstay of high-yield savings accounts.
Insured up to $250,000 at banks by the Federal Deposit Insurance Corp., and at credit unions by the National Credit Union Share Insurance Fund (per depositor, per institution, per ownership category), high-yield savings accounts offer a safe place to stash cash while earning interest.
That makes high-yield savings accounts a good place to keep funds for emergencies, large expenses and short-term savings goals.
Keep in mind that online banks typically offer higher rates and better benefits on these types of accounts than national brick-and-mortar banks. Online banks don’t have the costs associated with brick-and-mortar institutions and can pass those savings on to customers in the form of higher yields.
Live Oak Bank was founded in 2008. The online bank offers a competitive yield on its savings account. Like most online banks, Live Oak Bank’s Online Savings account doesn’t have a monthly service fee. It also doesn’t require you to keep a minimum balance.
In addition to its savings account, Live Oak Bank also offers seven terms of CDs. Live Oak Bank has its headquarters in Wilmington, North Carolina.
Vio Bank, established in 2018, is the national online division of MidFirst Bank. MidFirst Bank has been an FDIC-insured bank since 1934 and was established in 1911. Vio Bank offers both a High-Yield Online Savings account and CDs.
Vio Bank’s High-Yield Online Savings account has one of the top yields around, and all balances receive this APY.
In 1935, what’s now Alliant Credit Union was founded as the United Airlines Employees’ Credit Union. Alliant currently has 500,000 members.
You’ll need to keep at least $5 in your High-Rate Savings Account in order to keep it open. You’ll also need to maintain a $100 daily average minimum balance to earn interest with this account.
Comenity Direct is an online bank that offers both a high-yield savings account and five terms of CDs. Comenity Direct launched those savings products in 2019. The high-yield savings account requires you to open the account with $100.
Quontic Bank was established in 2005 and has its headquarters in New York. Quontic Bank calls itself the Adaptive Digital Bank.
You only need $100 to open a Quontic Bank High Yield Savings account. The account doesn't have a monthly maintenance fee.
In addition to this savings account, Quontic Bank also offers four terms of CDs. These CDs have terms ranging from six months to three years and require a $500 minimum deposit.
Popular Direct offers a savings account and term CDs. Both the Popular Direct savings account and its CDs are for established savers, since the Ultimate Savings account requires a $5,000 minimum deposit and its CDs have a $10,000 minimum deposit requirement.
All Popular Direct deposit accounts are opened through Popular Bank.
CIBC Bank USA, formerly The PrivateBank and Trust Company, was founded in 1991 and is based in Chicago. It was rebranded as CIBC Bank USA.
CIBC Bank USA calls its digital banking CIBC Agility. CIBC offers both a 9-month CD and a 1-year CD online. It also offers the CIBC Agility Online Savings Account, which offers a competitive yield.
Ally Bank started in 2004 and is headquartered in Sandy, Utah. In 2009, GMAC Bank was transformed into Ally Bank. Ally Bank exceeded 1 million Ally Bank customer accounts in 2012 and currently has around 2.25 million customers.
Besides its no-penalty CD, Ally Bank also offers a checking account, a money market account, term CDs, two terms of a Raise Your Rate CD.
The Citi Accelerate Savings account has a competitive APY in select markets. It’s not available in some larger states, such as California and New York. The savings account doesn’t require a minimum balance to open the account.
There is a $4.50 monthly service fee if your savings account isn’t linked to a Citi checking account. You can avoid this fee by keeping an average monthly balance of at least $500 in your savings account, if it’s not linked to a Citi checking account.
There is a $10 monthly service fee if you have a checking and savings account linked and don’t meet the requirements to have the fee waived.
Marcus by Goldman Sachs is a brand of Goldman Sachs Bank USA. Marcus offers a savings account, a variety of CDs and three no-penalty CD terms.
Its savings account doesn’t require a minimum opening deposit and it doesn’t have a monthly service fee. Marcus by Goldman Sachs an app on iOS and Google Play.
Synchrony Bank offers competitive yields across 12 terms. All standard CD terms typically offered by banks and credit unions are available.
If Synchrony Bank receives your CD deposit within the 15-day period -- and the CD rate increased, you’ll receive this higher rate.
The bank also offers a savings account and a money market account. The savings account has a competitive APY and has no minimum balance requirement.
Salem Five Direct is an online division of Salem Five. Salem Five was founded in 1855 in Salem, Massachusetts.
Salem Five Direct customers with the eOne Savings account earn a competitive yield on all balances up to $1,000,000.
Salem Five Direct customers can conduct a transaction at a Salem Five branch, but it will cost you $9.95. Residents of all 50 states can open a Salem Five Direct account.
TIAA Bank is a division of TIAA, FSB. TIAA Bank had 10 financial centers, all located in Florida as of March 2020. TIAA offers CD terms ranging from three months to five years.
TIAA Bank CDs require $1,000 to open and you’ll receive a reminder that your CD is maturing 20 days before that date.
Pentagon Federal Credit Union (PenFed) was established in 1935. It has more than 2 million members and has its main office in McLean, Virginia.
PenFed has nine terms of CDs. They range from a six-month CD to a seven-year CD.
Here are a few important things to consider when searching for a high-yield savings account.
One of the most important considerations when choosing a high-yield savings account is the APY.
APY includes the effect of compounding. It’s the interest earned on your initial deposit in addition to the interest earned on top of other interest earnings
And in the case of APYs, higher is always better. But it’s important to weigh the APY against the requirements to earn the yield.
For example, Bank X pays a slightly higher APY than Bank Y, but Bank X has a higher minimum deposit requirement and minimum balance requirement than Bank Y. If you can meet the requirements of Bank X, it’s worth considering. If not, Bank Y might be the better choice.
You can use Bankrate’s compound interest calculator to calculate your potential earnings on any savings account.
Besides the APY, you’ll also need to consider a bank or credit union’s tendency to adjust interest rates. Unlike CDs, which lock in a rate for a period of time, savings account yields tend to be variable. That means they could change at any time.
A bank may lower or raise an APY for various reasons. Your savings account rate could increase if a bank is trying to attract more deposits by offering a temporary promotional rate. Or broader economic factors — like the three Federal Reserve interest rate cuts in 2019, and the two emergency rate cuts from the Fed due to coronavirus in March 2020 — have caused banks and credit unions to lower their rates. Some savers have seen their yields slide in recent months as the Fed has lowered its benchmark rate.
Beware the bait and switch, since savings APYs are usually variable. Consider how often a bank offers teaser rates that may fluctuate and determine what your potential earnings could look like after a year. For more peace of mind, consider a CD or look for savings accounts with a rate guarantee for six months to one year.
The minimum opening deposit required can be a big factor when deciding on which high-yield savings account to choose.
Minimum deposit amounts vary across banks — some require nothing to open an account, while some require a deposit of $10,000 or more.
Consider your budget and decide how much you can realistically invest when comparing high-yield savings products. If you’re trying to hit a particular goal, ask yourself how much you’re willing to save and over what period of time.
The more you invest and the higher the interest rate, the faster compound interest will help you hit your goal. But if you can’t swing a particular minimum amount, it’s best to go with an account that requires less of an upfront financial commitment.
Often, you’ll find online banks that have no minimum opening deposit requirement or no minimum balance. You can also find online banks that won’t charge monthly maintenance fees. And some of them won’t have any of those requirements and fees.
Accounts requiring a higher minimum deposit might not offer a higher yield. Make sure to check minimum deposit requirements at all institutions you’re considering before opening an account. Many of the best high-yield savings accounts require a minimum opening deposit of $100 or less.
Not only do some high-yield savings accounts require a minimum deposit to open an account, they may also require a minimum balance to earn the APY or avoid fees.
One common fee banks charge for not maintaining a minimum balance in the account is called a “monthly maintenance fee.” But often, as long as you maintain the minimum balance, the bank will waive the fee.
Like minimum deposit amounts, minimum balance requirements can range from $0 to well over $10,000.
What’s important to consider when weighing the minimum balance requirements of various high-yield savings accounts is how often you’ll need to access the money, and whether you’ll be able to maintain the balance in order to earn the APY.
Before opening any type of savings account, it’s important to consider how often you’ll need to access the money.
Regulation D, also known as “Reg D,” is the reason savers might be limited to six transactions/withdrawals per month from savings accounts or money market accounts. That includes online transfers to different accounts, transfers over the phone, automatic transfers, overdrafts and check or debit transfers. But withdrawals or transfers made at an ATM or in-person at a bank don’t count toward this limit.
However, an interim final rule introduced last year by the Federal Reserve Board suspended enforcement of the six transfer limit and made this number unlimited. Banks might have a higher monthly limit now. For instance, American Express National Bank now allows up to nine withdrawals or transfers per month. But some banks might still have a six transactions limit. So, check with your bank to see its policy and limits.
Additionally, banks all have their own options and rules for withdrawing and transferring funds. So, it’s crucial to dive into the details of an account before signing up.
High-yield savings accounts can be used for any savings goal. Here are some of the best uses for a high-yield savings account:
Traditional conforming loans typically require a down payment of at least 5 percent. That moves up to 20 percent to avoid private mortgage insurance.
FHA loans require a down payment of at least 3.5 percent.
Here’s how much you’d need to save for a down payment on a $200,000 home:
Saving that amount of money can take some time. But a high-yield savings account can help you hit your goal faster.
Here’s a general estimate of how long it would take to save up a 20 percent, 5 percent and 3.5 percent down payment on a $200,000 home, assuming you have a high-yield savings account paying a 0.6 percent APY.
Assuming you’re going to finance the purchase of a car, you’re still likely going to need to make a down payment. Saving up and paying for a car with cash, check or an official bank check is even better since it will save you interest payments and financing fees.
Saving now, during the pandemic, can pay off for those planning to get married in the future. The national average cost of a wedding is $33,900, according to The Knot’s 2019 Real Wedding Study. And that doesn’t include the honeymoon. A high-yield savings account is one of the best places to money for your wedding because it’s liquid, safe — if it’s in a FDIC-insured account and within guidelines and limits — and can offer a competitive yield. If you have a year to save, you’d need to save around $2,741 per month in a high-yield savings account paying 0.6 percent APY in order to save around $33,900 for the wedding. That’s with an initial deposit of $1,000.
When saving for a child’s education, it’s best to start early and save often. College savings plans like the 529 can be a great solution, mainly because money grows tax-free in a 529. It also isn’t taxed when the money is taken out to pay for college.
But college tuition costs can sneak up fast, and a high-yield savings account can be a solid alternative in last-minute situations when saving is essential.
In order to successfully use a high-yield savings account for college tuition, you’ll need to set a savings goal and calculate the monthly investment needed to hit that goal.
For example, let’s say you need $50,000 for college tuition and your child is in seventh grade. If you open a savings account yielding 0.6 percent APY, you’d need to deposit around $806.43 per month in order to hit your goal by the time he or she heads off to college. That’s with an initial deposit of $1,000.
You can use Bankrate’s savings goal calculator to create a timeline for your savings goals.
Family vacations can be an exciting adventure, but they can also be tough on the wallet. Fortunately, a high-yield savings account can help out.
In order to properly use a high-yield savings account to pack away money for a family getaway, you’ll need to first decide how much you want to spend and when you’d like to go.
Then consider making a budget for travel, lodging, food and miscellaneous items.
How fast could a high-yield savings account help you get to your goal?
If you’re planning to spend $2,000 on a getaway in 12 months, you would need to save around $159 per month in a high-yield savings account paying 0.6 percent APY. That’s with an initial $100 deposit.
High-yield savings accounts aren’t only for major expenses.
In fact, one of the best purposes a high-yield savings account can serve is as a place for your emergency fund. This is a fund that typically covers three to six months of living expenses in case of things like an unexpected layoff or replacing a failing air conditioning unit during a hot summer.
The best high-yield savings accounts are usually found online. Online banks tend to offer the most competitive yields on their accounts. One reason why these banks can pay more is that they have fewer expenses since they don’t operate branches. But these online banks also need a way to get your attention. Often, a high yield is the way to do that. Many online banks also don’t charge a monthly service fee for their accounts and some of them don’t have minimum balance or minimum opening deposit requirements either.
Some banks offer tiered interest rates. To earn the highest yield, you may have to keep a large amount of money in your account. For example, a bank may offer a high yield, but it might require a deposit of at least $25,000 or even $100,000 to earn that APY.
Some savings accounts offer a competitive yield without requiring a high minimum deposit. Those kinds of accounts are ideal for savers in the process of building their emergency fund.
Calculate how much you stand to make with all of these offers using our simple savings calculator. Consider other factors before choosing a new bank, including fees, digital capabilities and branch and ATM access. And take a look at Bankrate’s expert reviews of popular banks with high-yield savings accounts.
High-yield savings accounts that offer an introductory rate may offer that fixed rate for a limited time. However, those accounts might be hard to find in this current rate environment. Most high-yield savings accounts will have a variable APY. This means the yield is subject to change. Those looking for a fixed yield should look at certificates of deposit. A no-penalty CD might be a good option for people looking for both a fixed APY and access to their money without incurring a penalty.
High-yield savings accounts help you earn a higher yield than a typical savings account. The national average savings account annual percentage yield (APY) is just around 0.07 percent APY. But that’s just the average. There are savings accounts earning even less yield than that — some of which are offered by the large brick-and-mortar banks.
Once you put money in a high-yield savings account, it earns interest. Then the interest, which is typically credited on a monthly or quarterly basis, begins to earn interest. That’s compound interest and it’s how your money starts to really grow over time.
High-yield savings account yields are usually variable. In other words, they could increase or decrease. However, it’s been a decreasing trend since around June 2019.
Over the past year, almost all savings accounts have decreased yields. But if you have money that has just been sitting in a non-interest bearing account, earning more interest in a high-yield savings account is likely worth it. Earning a competitive APY will help the account balance grow over time (assuming you don’t make withdrawals) and help it better keep up with long-term inflation. Money that’s not growing is bound to lose purchasing power over time.
The Federal Reserve began lowering rates in July 2019. Three rate cuts in 2019 (July, September and October) unwound a third of the rate increases from December 2015 to December 2018.
In March, two unscheduled emergency rate cuts by the Fed brought the federal funds rate down to zero — the same level it was at from December 2008 until December 2015. The Fed acted quickly in March, cutting rates due to the risks coronavirus posed to the economic outlook in 2020 and beyond. The top high-yield savings accounts have been decreasing, a few basis points every so often, ever since.
High-yield savings account APYs tend to move before or after the Fed lowers the federal funds rate. That’s why almost all high-yield savings accounts have decreased since around June 2019.
Here’s a look at Ally Bank’s savings yield, for instance:
Other high-yield savings accounts have had similar yield decreases over this same time period.
While you probably won’t earn as high of a yield as you would have earned earlier this year on a savings account, it is still worth earning a competitive yield on your emergency fund or any other money that you need to keep safe. Of course, always make sure it’s with a Federal Deposit Insurance Corp. (FDIC) bank and within FDIC limits and guidelines.
Your bank deposits in your high-yield savings account are protected by federal banking regulations. If your money in a high-yield savings account is parked at a Federal Deposit Insurance Corporation-insured bank, your money is safe. If your bank fails, you’ll get your money plus accrued interest back. The coverage is automatic. In the past, the FDIC says it has paid insurance within a few days after a bank closed.
There are limits, however. The FDIC covers up to $250,000 per depositor, per ownership category, per FDIC-insured institution. You don’t want to exceed the limits. For example, if you have $25,000 in a savings account and $250,000 in a CD at the same bank, that leaves $25,000 of deposits in that ownership category uninsured. You put your funds at risk if you exceed the FDIC-insured limit.
Double-check that the bank account you’re considering is FDIC-insured. You can use the FDIC’s BankFind tool to locate FDIC-insured institutions. After confirming that the bank you want to work with is insured, you’ll be able to breathe easily as you watch your funds grow.
In choosing your high-yield savings account, think about how you’ll want to interact with the banking institution. Are you comfortable banking completely online, or would you like some in-person service options as well?
Most high-yield savings accounts are offered by online banks. That means you’ll likely have to give up access to a physical branch in order to earn the highest APY. But you’ll still have access to your savings whenever you need it. Bank branches have limited business hours that restrict when you can interact with a banker. Online, you can manage your savings account 24/7. Most banks offer call center support, too.
There are exceptions to these general rules. For example, Capital One offers an attractive rate on its high-yield savings account as well as operates some physical branches that you could visit. Another example is PNC Bank, which offers a high-yield savings account in certain states in addition to operating a branch network.
Whether you want to build your emergency fund or save for a vacation or something else, a high-yield savings account can help you reach your goals. Opening a high-yield savings account is relatively simple, too. Here’s what you’ll need to do:
1. Shop around- High-yield savings accounts are offered by online banks, traditional banks with physical locations, and credit unions. The most important part of the process is to shop around to find the best high-yield savings account with the features you want (like a well-reviewed mobile app or no-fee account).
You’ll likely find higher APY offerings at online institutions because they don’t have as much overhead to support and pass the savings along to savers.
As you consider your options, think beyond APY, too. Compare the rates, fees and services offered to find the right fit for you.
2. Fill out an application- Once you’ve chosen a high-yield savings account, you’ll need to fill out an application. It might sound like an inconvenience. But it should only take a few minutes. The bank or credit union will likely ask for personal information, including your driver’s license number, Social Security number, mailing address, and date of birth.
In many cases, you’ll be able to fill out the application online.
3. Fund your account- Once you’ve been approved, it’s time to fund your account. You have a few options. You can fund your account by linking a checking account to your new savings account and transfer money from checking to savings. Some banks will also allow you to snap a picture of a check and make a mobile deposit to your new account. Depending on the bank, you might also be able to fund your new savings account with cash, through a wire transfer or by mailing in a check.
You’ll want to make sure you deposit enough money into the account to meet the minimum deposit requirement. The bank could charge you a maintenance fee or slap you with a lower than expected interest rate until you meet the minimum balance required.
First, ask your bank why you weren’t able to open a high-yield savings account. Depending on the answer, you might want to go to ChexSystems’ website and request a report to see whether your banking history is the reason why.
ChexSystems is a national specialty consumer reporting agency that keeps track of some of your banking history. Your check cashing history, any suspected fraud activity and closed accounts are some of the things that may appear on a ChexSystems report.
More than half (54 percent) of Americans said they have more in their emergency savings than they do in credit card debt, according to a February Bankrate survey. Just 27 percent of Americans said their credit card debt levels were higher.
Americans appear to be even more focused on increasing emergency savings, compared with Bankrate’s survey conducted a year earlier. In 2021, 52 percent of Americans said they’re focused on increasing emergency savings, compared with only 32 percent prioritizing paying down debt.
An emergency fund can help people get through unexpected situations. These can include a medical emergency, car repair or even a loss of employment
It’s important to concentrate on both saving and paying down debt. You don’t want to have an emergency happen and not have enough money to cover it. This can keep you from having to pay large amounts of interest on debt.
Budgeting is a great way to pay down debt and save more because it helps you plan where your money goes. Otherwise, you might live paycheck-to-paycheck without putting enough savings away or properly allocating money toward debt payments.
Automating your savings — through having part of your paycheck automatically put into a savings account — is a good way to ensure you’re saving on a regular basis. It’s easy to forget to save. And this method won’t let you.
Overall, high-yield savings accounts can be used for a range of purposes. From your emergency fund to saving up for a down payment, high-yield savings accounts can play a major part in your broader financial plan. If you’re looking for an account that can help you save while still offering easy access to your money, a high-yield savings account is worth consideration.
Use our quick recap of trusted bank reviews and APYs to pick a high-yield saving account that's right for you.
|Live Oak High-Yield Online Savings||0.60%||None||Live Oak Bank Review|
|Vio Bank High Yield Online Savings Account||0.57%||None ($5 if you receive paper statements)||Vio Bank Review|
|Alliant Credit Union High-Rate Savings Account||0.55%||None with eStatements ($1 for each paper statement.)||Alliant Credit Union Review|
|Comenity Direct High-Yield Savings Account||0.55%||None||Comenity Direct Bank Review|
|Quontic Bank High Yield Savings||0.55%||None||Quontic Bank Review|
|Popular Direct Select Savings||0.55%||None||Popular Direct Review|
|CIBC Agility Savings Account||0.50%||None||CIBC Bank Review|
|Ally Bank Online Savings Account||0.50%||None||Ally Bank Review|
|Citibank Accelerate High-Yield Savings||0.50%||None||Citibank Review|
|Marcus by Goldman Sachs High-Yield Online Savings Account||0.50%||None||Marcus by Goldman Sachs Bank Review|
|Synchrony Bank High Yield Savings||0.50%||None||Synchrony Bank Review|
|Salem Five Direct eOne Savings||0.50%||None||Salem Five Direct Bank Review|
|TIAA Bank Basic Savings||0.50%||None||TIAA Bank Review|
|Pentagon Federal Credit Union Premium Online Savings Account||0.45%||None||Pentagon Federal Credit Union Review|
|American Express||0.40%||5 stars||American Express is an online bank that offers 24/7 customer service and up to nine withdrawals per statement cycle.||Member FDIC|
|Barclays||0.40%||4.4 stars||Barclays is an online bank that doesn’t have a monthly service fee. It also doesn’t require a minimum deposit to open this account.||Member FDIC|
|Capital One||0.40%||4.9 stars||Capital One has banking products, online services, and around 381 branch locations. It also has Capital One Cafes. Capital One’s 360 Performance Savings account doesn’t require a minimum deposit to open this account and you’re not required to keep a certain balance in the account.||Member FDIC|
|CIT Bank||Up to 0.40%||4.0 stars||The CIT Savings Builder encourages you to save by giving you a higher APY for depositing at least $100 per month. You can also get this yield with a balance of at least $25,000.||Member FDIC|
|Citizens Access||0.40%||4.2 stars||Citizens Access launched in July 2018 and offers a savings account that requires a minimum opening deposit of $5,000. You’ll want to keep at least $5,000 in this online savings account to earn a competitive APY.||Member FDIC|
|Discover Bank||0.40%||4.4 stars||Discover Bank’s Online Savings Account doesn’t require a minimum deposit to open the account and doesn’t have a monthly maintenance fee.||Member FDIC|
|PNC Bank||0.40%||4.4 stars||The PNC High Yield Savings account offers a competitive yield in certain markets. The account doesn’t require an opening deposit and doesn’t have a monthly service fee.||Member FDIC|
|PurePoint Financial||0.40%||4.8 stars||PurePoint Financial requires a $10,000 opening deposit for its savings account. You’ll need to keep a balance of more than $10,000 to earn a more competitive APY.||Member FDIC|