Yes, Wells Fargo savings accounts earn interest, but the rate is very low
Wells Fargo does pay interest on savings accounts. However, the rate they offer is typically much lower than what you can find at online banks or credit unions. As of now, Wells Fargo's standard savings account rate is less than 0.01% annually on most balances — meaning a $1,000 deposit would earn less than 10 cents per year.
The exact rate changes over time and may vary slightly depending on your account type and balance. Wells Fargo publishes their current rates on their website, and you can call their customer service line to confirm the rate for the specific account you're considering. The key point is that while they do pay interest, the amount is small enough that it should not be your main reason for choosing Wells Fargo over another bank.
Key Takeaways
- Wells Fargo savings accounts earn interest, but at rates below 0.01% annually on standard accounts.
- Online banks and credit unions typically offer savings rates 10 to 50 times higher than Wells Fargo's current rates.
- Interest rates change regularly, so you should check Wells Fargo's website or call them directly to see the current rate before opening an account.
- The interest you earn at Wells Fargo will likely be too small to meaningfully grow your savings compared to other financial institutions.
How Wells Fargo calculates and pays interest
Wells Fargo uses a method called daily compounding, which means they calculate interest on your balance every single day and add it to your account. The interest is then credited (added to your account) monthly. This is a standard practice across most banks.
The formula is straightforward: your balance multiplied by the annual interest rate, divided by 365 days. So if you have $10,000 in a Wells Fargo savings account earning 0.01% annually, you would earn about $1 per year, or roughly 8 cents per month. The actual amount depends on your exact balance each day, since the calculation happens daily.
You do not have to do anything to receive the interest — it deposits automatically each month. You will see it listed on your monthly statement as "interest earned" or "interest paid."
Why Wells Fargo's rates are lower than other banks
Wells Fargo is a large, traditional brick-and-mortar bank with physical branches in most states. They have costs that online-only banks do not: they pay for buildings, staff, and in-person customer service. These costs are passed along to customers partly through lower interest rates on savings.
Online banks like Marcus, Ally, and Discover have no physical locations and much lower overhead. They can afford to pay much higher interest rates on savings accounts — often 4% to 5% annually or more, depending on the current economic environment. Credit unions, which are member-owned rather than shareholder-owned, also tend to offer better rates than large national banks.
If you keep a significant amount in savings, the difference between Wells Fargo's rate and an online bank's rate can add up. A $10,000 savings account earning 0.01% at Wells Fargo would earn about $1 per year, while the same account at an online bank earning 4.5% would earn $450 per year — a difference of $449.
Types of Wells Fargo savings accounts and their rates
Wells Fargo offers several savings products, and rates may differ slightly between them. The main options are a standard savings account and money market accounts. Money market accounts sometimes offer slightly higher rates in exchange for requiring a larger minimum balance and limiting how often you can withdraw money.
Wells Fargo also offers certificates of deposit (CDs), which are a different product from savings accounts. A CD is an agreement where you give the bank your money for a set period — typically three months to five years — and in return they pay you a fixed interest rate. CD rates are usually higher than savings account rates, but you cannot withdraw the money early without paying a penalty.
You should check Wells Fargo's current rates for each account type on their website, since rates change regularly and may vary based on your location or account details.
When interest rates change and how to stay informed
Interest rates on savings accounts change when the Federal Reserve adjusts its benchmark interest rate, which happens several times per year. When the Fed raises rates, banks typically raise the interest they pay on savings accounts. When the Fed lowers rates, banks lower what they pay to savers.
Wells Fargo is not required to pass along every Fed rate change to customers, and they often move slowly. This means that even when rates rise nationally, Wells Fargo's savings rate may stay the same for months. This is another reason why online banks often offer better rates — they tend to adjust faster to market changes.
To stay informed about Wells Fargo's current rates, visit their website directly or call 1-800-869-3557. You can also ask a banker at any Wells Fargo branch. Do not rely on rates you see quoted online, since they change frequently and may be outdated.
Comparing Wells Fargo to other savings options
If earning interest on your savings matters to you, it makes sense to compare Wells Fargo against other institutions. Online banks like Marcus, Ally, and Discover typically offer rates 10 to 50 times higher than Wells Fargo. Credit unions in your area may also offer better rates, especially if you are a member.
The trade-off is convenience. Wells Fargo has branches and ATMs everywhere, so you can deposit cash or speak to someone in person. Online banks have no physical locations, so you cannot walk in with a check or cash. However, most online banks let you deposit checks by taking a photo with your phone, and they reimburse ATM fees if you use an out-of-network machine.
If you keep most of your money in savings and only use Wells Fargo for checking or everyday banking, you might consider keeping your savings at an online bank while using Wells Fargo for other services. Many people do this to earn better interest without giving up the convenience of a local branch.
What happens to your interest if you close your account
If you close a Wells Fargo savings account, you receive all the interest that has been earned up to the day you close it. The interest is paid out as part of your final balance. You do not lose any interest by closing the account, as long as the interest has already been credited to your account.
Interest is typically credited monthly, so if you close your account mid-month, you will not receive interest for those partial days. However, any interest that was credited in previous months stays yours.
Frequently Asked Questions
How often does Wells Fargo pay interest on savings accounts?
Wells Fargo credits interest to your savings account once per month. The interest is calculated daily based on your balance, but you see it added to your account in one lump sum each month, usually around the same date.
Can I earn more interest by keeping a larger balance at Wells Fargo?
Wells Fargo does not offer tiered interest rates based on balance size for most savings accounts. Whether you have $100 or $100,000, you earn the same annual percentage rate. Some money market accounts may have slightly higher rates, but the difference is usually minimal.
Is the interest I earn at Wells Fargo taxable?
Yes. Any interest you earn is considered income and must be reported on your federal tax return. Wells Fargo will send you a Form 1099-INT each January showing how much interest you earned the previous year. However, at Wells Fargo's current rates, the amount is usually so small that it has little impact on your taxes.
What is the minimum balance needed to earn interest at Wells Fargo?
Wells Fargo's standard savings account has no minimum balance requirement to open or to earn interest. However, they do charge a monthly maintenance fee if your balance falls below $300 in some account types. You should confirm the current requirements on their website or by calling customer service.
If I move my money to an online bank, will I lose my Wells Fargo account?
No. You can keep your Wells Fargo savings account open while also having accounts at other banks. Many people maintain accounts at multiple institutions for different purposes. Just be aware that Wells Fargo may charge a monthly fee if your balance drops below their minimum, so check the terms before you move your money.