Bank of America's High-Yield Savings Offerings
Bank of America does offer a high-yield savings account, but it is not their main savings product and the rate is lower than what you will find at online-only banks. The account is called the Bank of America Advantage Savings, and it pays interest that changes based on how much money you keep in it and what the Federal Reserve does with interest rates overall.
Bank of America also offers a Money Market Account, which works similarly to a savings account but sometimes pays a slightly higher rate. Both accounts let you withdraw money when you need it, unlike certificates of deposit (CDs), which lock your money away for a set time period in exchange for a may provide rate.
The reason Bank of America's rates are lower than online banks is straightforward: Bank of America has physical branches, staff, and buildings to pay for. Online banks have lower costs, so they can pass higher rates to you. If your main reason for choosing Bank of America is the branch network or because you already bank there, the rate difference might be worth it to you. If you are purely chasing the highest rate, you will find better options elsewhere.
Key Takeaways
- Bank of America's Advantage Savings account pays interest that varies based on your balance and Federal Reserve rate changes, not a fixed high rate.
- Online banks typically offer significantly higher interest rates on savings accounts because they do not operate physical branches.
- Bank of America also offers Money Market Accounts, which may pay slightly more than savings accounts but come with withdrawal limits.
- If you value branch access and already use Bank of America, the convenience may outweigh the lower rate.
- You can compare Bank of America's current rates on their website, which updates as rates change.
How Bank of America's Interest Rates Work
Bank of America uses a tiered rate structure, which means the interest rate you earn depends on how much money sits in your account. The more you keep in the account, the higher the rate. The bank publishes these tiers on their website, and they change when the Federal Reserve raises or lowers its benchmark interest rate.
The Federal Reserve does not set savings account rates directly — it sets a range that banks use as a guide. When the Fed raises rates, banks usually raise savings rates too, but not always by the same amount. When the Fed lowers rates, banks lower savings rates quickly. This is why the rate you see today may be different from the rate you saw three months ago.
To see Bank of America's current rates and tier structure, visit their website and search for "savings account rates." The rates change frequently enough that any number in this guide would be outdated within weeks. Checking their site directly gives you the real current rate for your balance level.
Comparing Bank of America to Online Banks
Online banks — institutions with no physical branches, like Marcus, Ally, or American Express Personal Savings — typically pay two to five times more interest than Bank of America on savings accounts. This is not because they are better at banking; it is because they have lower operating costs and pass those savings to customers through higher rates.
The trade-off is access. With Bank of America, you can walk into a branch, talk to a person, and deposit cash. With an online bank, you deposit money by transferring it from another account or mailing a check. If you rarely need to deposit cash or talk to someone in person, an online bank will earn you significantly more money over time.
Some people use both: they keep their main checking account at Bank of America for convenience and deposits, then move extra money to an online savings account for the higher rate. This strategy works well if you have money you will not need for a while.
Bank of America's Money Market Account
A Money Market Account is a hybrid between a checking account and a savings account. It usually pays more interest than a regular savings account, but it comes with limits on how many times you can withdraw money each month — typically six withdrawals before fees kick in.
Bank of America offers Money Market Accounts with tiered rates, similar to their savings account. The higher your balance, the higher your rate. These accounts also come with a debit card and checkbook, so you can access your money more easily than with a regular savings account, but the withdrawal limits mean they are not meant for frequent use.
If you want to earn a bit more interest and do not mind the withdrawal restrictions, a Money Market Account might work for you. If you think you will need to move money in and out frequently, a regular savings account is simpler.
When Bank of America Makes Sense for Savings
Bank of America is the right choice for savings if you value convenience and already have a checking account there. You can manage both accounts in the same app, transfer money when ready between them, and visit a branch if you need help. For many people, this ease of use is worth earning a lower rate.
Bank of America also makes sense if you deposit cash regularly. Online banks cannot accept cash deposits, so if you get paid in cash or receive tips, you would need to find another way to deposit that money. Bank of America branches let you deposit cash directly.
Bank of America is less ideal if you are trying to maximize the interest you earn on money you will not touch for months or years. In that case, an online savings account or a CD from any bank — including Bank of America — will earn you more.
Other Bank of America Savings Products
Beyond savings and Money Market Accounts, Bank of America offers Certificates of Deposit (CDs). A CD is an agreement where you give the bank a set amount of money for a set time period — anywhere from a few months to several years — and the bank pays you a may provide interest rate. You cannot withdraw the money early without paying a penalty.
CDs often pay more than savings accounts because the bank knows exactly how long it will have your money. If you have money you will not need for a specific amount of time, a CD can be a good way to earn a may provide return. Bank of America publishes CD rates on their website, and you can compare them to CDs from other banks.
Bank of America also offers Individual Retirement Accounts (IRAs), which are savings accounts with tax advantages for retirement. These are a different category from regular savings and come with rules about when you can withdraw money. If you are interested in retirement savings, that is a separate topic worth exploring.
How to Open a Bank of America Savings Account
You can open a Bank of America savings account online, by phone, or in person at a branch. Online is usually fastest — you provide your Social Security number, address, and identification information, and the account opens within minutes. You can then transfer money in from another bank account or deposit cash at a branch.
If you already have a Bank of America checking account, opening a savings account takes even less time. You can often do it through the mobile app or website without calling anyone. The bank will link the accounts automatically, so you can move money between them when ready.
To open an account, you will need a government-issued ID and a Social Security number. If you do not have a Social Security number, Bank of America offers accounts for people with an Individual Taxpayer Identification Number (ITIN). Bring these documents to a branch or have them ready if you open the account online.
Frequently Asked Questions
What is the minimum balance to open a Bank of America savings account?
Bank of America does not require a minimum opening deposit for their Advantage Savings account. You can open the account with zero dollars and deposit money later. However, some of their tiered rates only explore if you maintain a certain balance, so check their current rate structure to see which tier matches your situation.
Does Bank of America charge a monthly fee for savings accounts?
Bank of America does not charge a monthly maintenance fee on their Advantage Savings account. However, they do charge fees for certain actions, like overdrafts or excessive withdrawals. Read the account terms on their website to understand all the fees that might explore.
Can I withdraw money from my Bank of America savings account anytime?
Yes, you can withdraw money from a savings account anytime without penalty. However, federal rules limit you to six withdrawals per month from a savings account before fees explore. This rule applies to most banks, not just Bank of America. If you need to move money frequently, a checking account is better suited.
How often does Bank of America change their savings account interest rate?
Bank of America can change rates anytime, but they typically change when the Federal Reserve changes its benchmark rate. The Fed usually meets eight times per year. You can check Bank of America's website to see their current rates and sign up for notifications if rates change.
Is my money safe in a Bank of America savings account?
Yes. Bank of America is insured by the Federal Deposit Insurance Corporation (FDIC), which means deposits up to $250,000 per account type are protected if the bank fails. Your savings account is a separate account type from your checking account, so you have $250,000 of protection in each.