Bank of America's interest rates change based on the account type and the Federal Reserve's decisions

Bank of America does not publish a single "interest rate." Instead, the bank sets different rates for different products: savings accounts, money market accounts, certificates of deposit (CDs), and interest-bearing checking accounts all have separate rates. These rates move up and down together when the Federal Reserve changes its benchmark rate, but they do not all move by the same amount or at the same time.

The rates you see advertised on Bank of America's website are the rates the bank is currently offering to new customers. Existing customers may see different rates depending on when they opened their account and what tier of customer they are—the bank offers higher rates to customers who maintain larger balances or have multiple products with the bank.

As of now, Bank of America's savings account rates are substantially lower than rates offered by online-only banks. This is typical: large national banks with physical branches tend to offer lower rates because they do not need to compete as aggressively for deposits. You can check the current rates on Bank of America's website or by calling your local branch, since rates can shift without notice.

Key Takeaways

  • Bank of America offers different interest rates for savings accounts, money market accounts, CDs, and checking accounts, and each rate moves independently.
  • The bank's rates are typically lower than online-only banks because Bank of America maintains physical branches and does not need to offer high rates to attract deposits.
  • Your personal rate depends on your account type, the balance you maintain, and when you opened the account—not everyone with the same account type earns the same rate.
  • Bank of America changes its rates when the Federal Reserve moves its benchmark rate, but the timing and size of the change varies by product.

How the Federal Reserve affects Bank of America's rates

When the Federal Reserve raises or lowers its benchmark interest rate (called the federal funds rate), Bank of America and other banks adjust their rates in response. However, the bank does not raise or lower rates by the exact amount the Fed moves. A 0.25 percentage point increase from the Fed might result in a 0.10 percentage point increase on savings accounts and a 0.20 percentage point increase on CDs.

The lag between a Federal Reserve decision and a Bank of America rate change can be anywhere from when ready to several weeks. The bank is not required to move rates on any particular schedule. Some products move faster than others—money market accounts sometimes shift within days, while savings account rates may take longer.

You can track the Federal Reserve's rate decisions on the Federal Reserve's official website. Bank of America publishes its current rates on its website under each product category, though the site does not always show the historical changes or explain why a rate moved.

Savings accounts and money market accounts at Bank of America

Bank of America's regular savings account (called the Basic Savings account) earns a very low rate—often less than 0.01 percent annually. This means a $10,000 balance would earn less than $1 per year. The bank also offers a Premium Savings account, which requires a higher opening balance and a higher minimum balance to earn a slightly better rate, though still well below what online banks offer.

Money market accounts at Bank of America typically pay a higher rate than savings accounts, but require a larger minimum balance to open and to earn the stated rate. If your balance drops below the minimum, the rate drops as well. The exact minimums and rates change, so you need to check the current terms on Bank of America's website.

Both account types are FDIC-insured up to $250,000, meaning your money is protected if the bank fails. This insurance is the same at every bank, so it does not explain why Bank of America's rates are lower—the difference is straightforward that the bank chooses to offer lower rates.

Certificates of deposit (CDs) at Bank of America

Bank of America offers CDs with terms ranging from 3 months to 5 years. Longer-term CDs pay higher rates than shorter-term ones, though the difference is usually small. A 5-year CD might pay 0.10 percentage points more than a 1-year CD, for example.

When you buy a CD, you lock in that rate for the entire term. If rates rise after you buy the CD, you cannot access the higher rate without breaking the CD early—and breaking it early means paying a penalty. The penalty amount varies by term length; longer CDs have larger penalties. Bank of America publishes the penalty amounts on its website for each term.

CDs are also FDIC-insured, and the insurance covers each CD separately. If you have a $250,000 CD and a $250,000 savings account at Bank of America, both are fully insured.

Interest-bearing checking accounts

Bank of America offers checking accounts that pay interest, though the rates are extremely low—often 0.01 percent or less. These accounts usually require a high minimum balance to earn any interest at all, and the interest earned is negligible compared to what you would earn in a savings account or CD.

Most people use Bank of America checking accounts for the convenience of the branch network and ATM access, not for the interest. If earning interest on your checking balance is important to you, online banks and credit unions often offer checking accounts with higher rates, though they do not have physical branches.

Why Bank of America's rates are lower than online banks

Online banks like Marcus, Ally, and American Express Personal Savings have much lower operating costs than Bank of America. They do not maintain buildings, employ tellers, or operate ATM networks. Because their costs are lower, they can afford to offer higher interest rates and still make a profit. Bank of America's physical presence is valuable if you need to deposit cash or speak to someone in person, but it costs money—and that cost is reflected in lower interest rates.

Bank of America also does not need to compete aggressively on rates because many customers stay with the bank for reasons other than interest: direct deposit setup, mortgage relationships, credit cards, or straightforward habit. Online banks must offer higher rates to attract customers who have no other reason to choose them.

This does not mean Bank of America is a bad choice for savings. If you already have a checking account there and value the convenience, the difference in interest earned might be worth it. But if you are opening a new account purely to earn interest, an online bank will pay you significantly more.

How to find Bank of America's current rates

Bank of America publishes its current rates on its website under each product category: savings, money market, CDs, and checking. You can also call your local branch or visit in person to ask about rates. The rates on the website are the rates for new customers; if you are an existing customer, your rate may be different.

The website does not always show when rates last changed or what the rate was previously. If you want to track how Bank of America's rates have moved over time, you can use third-party websites like Bankrate or DepositAccounts, which maintain historical rate data for most banks.

When you compare Bank of America's rates to other banks, make sure you are comparing the same product type. A Bank of America savings account should be compared to other banks' savings accounts, not to their CDs or money market accounts.

Frequently Asked Questions

Does Bank of America pay interest on checking accounts?

Bank of America offers interest-bearing checking accounts, but the rates are extremely low—typically 0.01 percent or less. You must maintain a high minimum balance to earn any interest. Most customers use Bank of America checking for convenience, not for interest earnings.

When does Bank of America change its interest rates?

Bank of America changes rates in response to Federal Reserve decisions, but there is no set schedule. Changes can happen when ready or take several weeks. The bank does not announce rate changes in advance, so you need to check the website or call your branch to see if a rate has moved.

Will my interest rate go up if the Federal Reserve raises rates?

Probably, but not by the same amount. If the Federal Reserve raises its rate by 0.25 percentage points, Bank of America might raise savings account rates by 0.10 percentage points and CD rates by 0.20 percentage points. The timing and size of the increase vary by product.

Can I earn more interest by keeping a larger balance?

Yes. Bank of America offers higher rates on some accounts if you maintain a larger balance. Premium Savings accounts and some money market accounts have tiered rates—the more you keep in the account, the higher your rate. Check the current terms on the website to see which accounts offer this.

Is my money safe in a Bank of America savings account?

Yes. Bank of America savings accounts, money market accounts, and CDs are all FDIC-insured up to $250,000 per account type. This means if the bank fails, the federal government guarantees your money up to that limit. This protection is the same at every bank.