Bank of America does not offer a traditional high-yield savings account

Bank of America's standard savings accounts earn interest rates well below what you can find elsewhere. As of now, BofA's regular savings account pays around 0.01% APY, and their Money Market account pays slightly higher rates depending on your balance—but still far below what online banks and credit unions offer. If earning meaningful interest on your savings is your goal, BofA is not the right choice.

What BofA does offer is a tiered structure: the higher your balance, the slightly better your rate. But "slightly better" still means rates that lag behind competitors by a full percentage point or more. A high-yield savings account elsewhere might pay 4% to 5% APY, while BofA's best-case scenario sits closer to 0.04% APY on their Money Market account with a large balance.

The reason BofA keeps rates low is straightforward: they are a large brick-and-mortar bank with physical branches, staff, and overhead. Online-only banks have lower costs and pass some of those savings to customers through higher rates. BofA prioritizes branch access and other services over competitive interest rates.

Key Takeaways

  • Bank of America's savings accounts pay around 0.01% to 0.04% APY depending on the account type and balance, which is significantly lower than high-yield options elsewhere.
  • If you keep money at BofA primarily for checking and bill pay, a savings account there is convenient but will not earn meaningful interest.
  • Online banks and some credit unions offer rates 4% to 5% higher, making them a better choice if your main goal is interest earnings.
  • You can hold both a BofA checking account for daily banking and a high-yield savings account at another institution for your emergency fund or savings goals.

What BofA's savings accounts actually pay

Bank of America offers two main savings products: the regular Savings Account and the Money Market Account. The regular savings account has a low minimum balance requirement (often $0 to open) but pays minimal interest. The Money Market account requires a higher opening balance—typically $2,500 or more depending on your state—and pays a slightly higher rate, but still nowhere near competitive with online banks.

Interest rates at BofA change based on Federal Reserve decisions, so the exact percentage you see today may shift. What does not change is the gap: BofA will always lag behind online high-yield savings accounts by a significant margin. That gap costs you real money. On a $10,000 balance, the difference between 0.01% and 4.5% is roughly $450 per year in lost interest.

Why BofA rates stay low

Large national banks like BofA operate thousands of branches, employ thousands of staff, and maintain physical infrastructure. Those costs get passed along to customers through lower interest rates on savings and higher fees on checking. Online banks have no branches and minimal staff, so they can afford to pay more interest and charge fewer fees.

BofA's value proposition is not interest rates—it is convenience, brand recognition, and the ability to walk into a branch if you need help. If you prioritize that convenience, the lower rate is the trade-off. If you prioritize interest earnings, you need to look elsewhere.

How to earn higher interest while keeping a BofA checking account

You do not have to choose between BofA and a high-yield savings account. Many people keep a checking account at BofA for everyday banking and bill pay, then move money they want to save into a high-yield account at an online bank or credit union. This approach gives you the convenience of BofA's branch network plus the interest earnings you actually want.

Moving money between accounts takes one to three business days, so this works best if you are not moving money constantly. Set up a transfer schedule—for example, moving a fixed amount to your high-yield account each payday—and let it run automatically. You will earn interest on that money while keeping your checking account where it is.

Some credit unions also offer high-yield savings accounts and may have branches near you. If you are a member of a credit union, check their rates before opening an account at an online bank. Credit unions sometimes offer competitive rates and the added benefit of local branches.

What to look for in a high-yield savings account

When comparing high-yield savings accounts, focus on three things: the current APY rate, whether the rate is may provide or variable, and whether the bank is FDIC-insured. Most online banks are FDIC-insured, which means your deposits up to $250,000 are protected if the bank fails.

APY rates change frequently, so do not lock into a decision based on today's rate alone. Instead, look at which banks have historically paid competitive rates and check their current offers. Banks that consistently rank high on rate comparison sites tend to stay competitive over time.

Avoid accounts with monthly fees, minimum balance requirements, or withdrawal limits. High-yield savings accounts should be free to open and maintain. If a bank is charging you to save money, that defeats the purpose.

The tax and reporting side

Interest you earn on any savings account—whether at BofA or elsewhere—is taxable income. Banks send you a 1099-INT form each January if you earned $10 or more in interest during the year. You report this on your tax return. This applies equally to high-yield accounts and low-yield accounts; the difference is that a high-yield account will actually generate enough interest to report.

This is not a reason to avoid high-yield accounts. Paying tax on $450 in interest is far better than earning $1 in interest and paying nothing. The tax is on the earnings you actually made, not a penalty.

Frequently Asked Questions

Can I move money from BofA to a high-yield account without closing my BofA account?

Yes. You can keep your BofA checking and savings accounts open while opening a high-yield account elsewhere. Transfer money between them as often as you want. There is no requirement to close BofA accounts to use another bank.

How long does it take to transfer money from BofA to another bank?

Most transfers take one to three business days. If you set up an external transfer from BofA's website or app, you will see an estimated delivery date. Weekends and holidays add time, so plan accordingly if you need the money on a specific date.

Is my money safe in a high-yield account at an online bank?

If the online bank is FDIC-insured, your deposits up to $250,000 are protected by federal insurance, the same way they are at BofA. Check the bank's website or the FDIC's bank search tool to confirm FDIC insurance before opening an account.

What if I need to withdraw money from a high-yield account quickly?

You can withdraw money anytime, but transfers to another bank take one to three business days. If you need cash when ready, you would need to use a debit card or ATM if the bank offers one. For true emergency funds, keep some cash in a checking account you can access when ready.

Do I need a minimum balance to open a high-yield savings account?

Most online banks have no minimum balance requirement to open an account. Some require a small initial deposit, like $0.01 or $1. Check the specific bank's requirements before opening, but generally high-yield accounts are accessible even with very small balances.