Where to find high-yield savings accounts right now

High-yield savings accounts are offered by online banks, some traditional banks, and credit unions. The banks paying the highest rates tend to be online-only operations like Marcus by Goldman Sachs, Ally Bank, American Express Personal Savings, Discover Bank, and Capital One 360. Credit unions also offer competitive rates through networks like CO-OP and Allpoint, though the rate varies by which credit union you join. Traditional brick-and-mortar banks like Chase, Bank of America, and Wells Fargo offer savings accounts, but their rates are typically much lower than online alternatives.

The rate you see advertised today will not be the rate next month. Banks change their rates weekly or even daily based on what the Federal Reserve does and what competing banks are offering. A bank offering 4.5% one month might drop to 4.2% the next. This means the "highest" account is always shifting, and the best choice depends partly on which bank you already use and whether you value having a physical branch nearby.

Key Takeaways

  • Online banks typically offer higher rates than traditional banks because they have lower overhead costs and compete mainly on rate rather than branch locations.
  • The rate you receive changes frequently and depends on Federal Reserve policy, so comparing rates this week does not tell you what you will earn next month.
  • Credit unions can offer competitive rates, but the specific rate depends on which credit union you join, not on credit unions as a category.
  • Some banks require a minimum deposit to open an account or to earn the advertised rate, so read the terms before opening.
  • Moving money between banks takes one to three business days, so if you switch accounts, plan ahead rather than waiting until you need the money.

Online banks versus traditional banks

Online banks pay higher rates because they do not maintain physical branches, pay fewer staff, and spend less on real estate. That lower cost structure means they can pass more of the interest they earn back to you. Marcus by Goldman Sachs, Ally Bank, and American Express Personal Savings are examples of banks that exist only online. You open an account through a website, deposit money by electronic transfer, and manage everything through an app or website.

Traditional banks like Chase, Bank of America, and Wells Fargo have physical locations where you can walk in and speak to someone. That convenience costs money, and they typically pass that cost to customers by offering lower savings rates. If you value being able to deposit cash in person or speak to someone face-to-face, a traditional bank may be worth the lower rate. If you are comfortable managing money online and want the highest rate, an online bank is usually the better choice.

Credit unions and their rate structure

Credit unions are member-owned financial institutions, not corporations. Some credit unions offer high-yield savings accounts, but the rate depends entirely on which credit union you join. Navy Federal Credit Union, for example, may offer a different rate than Connexus Credit Union. You cannot join every credit union—membership is usually based on where you work, where you live, what organization you belong to, or family connections to an existing member.

To find credit unions near you, use the CO-OP Network locator or the Allpoint ATM network website. These networks let credit union members use thousands of ATMs and branches nationwide without paying out-of-network fees. If you already belong to a credit union, call and ask what rate they currently offer on savings accounts. If you do not belong to one, you can search by location or employer to see which ones you might join.

What to check before opening an account

Before you open a high-yield savings account, look for three things: the current rate, any minimum deposit requirement, and whether the rate applies to all balances or only balances above a certain amount. Some banks advertise a high rate but only pay it on the first $25,000 you deposit, then a lower rate on anything above that. Others require you to deposit at least $500 or $1,000 to open the account.

Also check whether the bank charges monthly fees. Most online banks do not charge monthly maintenance fees, but some traditional banks do. A $10 monthly fee on a savings account earning 4% interest can wipe out most of your earnings if your balance is small. Read the account terms on the bank's website or call and ask directly—the fee structure is always disclosed, but it is sometimes buried in the fine print.

How rates change and what that means for you

Banks set their savings rates based on the Federal Reserve's benchmark interest rate, called the federal funds rate. When the Federal Reserve raises its rate, banks usually raise savings rates within days or weeks. When the Federal Reserve lowers its rate, banks lower savings rates even faster. This means a 4.5% account today might be 3.8% in six months if the Federal Reserve cuts rates.

You cannot lock in a rate on a savings account the way you can with a certificate of deposit (CD). Your rate will change whenever the bank decides to change it. This is not a reason to avoid high-yield savings accounts—they are still the best place to keep money you might need soon. But it means you should not expect the rate you see today to last forever, and you should not choose a bank based solely on its current rate.

Moving money between banks

If you open a high-yield savings account at one bank and later want to move your money to another, the process is straightforward but takes time. You can transfer money electronically from one bank to another using the receiving bank's transfer tool. The transfer usually takes one to three business days. You can also withdraw cash and deposit it at the new bank, but that is slower and riskier because you are holding cash.

Some banks offer a service called "account transfer" where they handle moving your money from your old bank automatically. Ask the new bank whether they offer this service. If you have automatic deposits or payments set up at your old bank, you will need to update those separately—the bank transfer does not move those instructions.

Comparing rates across banks

To compare current rates, visit the websites of banks you are considering and look for the savings account rate listed on the main page or in the rates section. Websites like Bankrate, DepositAccounts, and DepositRate also list rates from multiple banks side by side, though the rates on those sites may lag by a day or two. Call the bank directly if you want the absolute current rate, since rates can change daily.

When you compare, write down the rate, any minimum deposit, any monthly fees, and whether the rate applies to your full balance or only part of it. Then rank the banks by the rate you would actually earn on the amount of money you plan to deposit. A bank offering 4.8% with a $25,000 minimum is not better than one offering 4.5% with no minimum if you only have $10,000 to deposit.

Frequently Asked Questions

Can I move my money out of a high-yield savings account whenever I want?

Yes. Savings accounts have no withdrawal restrictions or penalties. You can move your money to another bank, withdraw it as cash, or transfer it to a checking account at any time. The transfer takes one to three business days, but there is no fee or penalty for moving your money.

Is my money safe in an online bank?

Yes, as long as the bank is FDIC-insured. FDIC insurance protects your deposits up to $250,000 per account type at each bank. Check the bank's website for the FDIC logo or call and ask. Most online banks are FDIC-insured, but verify before you deposit money.

Why do some banks offer much higher rates than others?

Online banks have lower costs and compete mainly on rate, so they offer higher rates to attract customers. Traditional banks have physical branches and higher overhead, so they offer lower rates. Some banks also raise rates temporarily to attract new customers, then lower them later.

What happens to my rate if the Federal Reserve lowers interest rates?

Your rate will likely drop within weeks. Banks lower savings rates quickly when the Federal Reserve cuts rates. The exact timing and amount of the cut depends on the bank, but you should expect your rate to fall if the Federal Reserve lowers its benchmark rate.

Do I need a minimum balance to earn the advertised rate?

It depends on the bank. Some banks pay the advertised rate on all balances, no matter how small. Others require a minimum deposit to open the account or to earn the highest rate. Check the account terms before you open the account to know what applies to you.