Banks offering high yield savings accounts today

High yield savings accounts exist at online banks, not at the brick-and-mortar branches most people use. Banks like Marcus (owned by Goldman Sachs), Ally Bank, American Express Personal Savings, Capital One 360, and Discover Bank all offer them. The rates these banks pay change weekly based on what the Federal Reserve does, so the "best" rate today may not be the best rate next month.

The reason online banks pay more is straightforward: they have no physical branches, no tellers, no building leases. That lower overhead means they can pass more of their earnings to depositors. A traditional bank's savings account might pay 0.01% APY while an online bank pays 4.5% or higher on the same $10,000. Over a year, that difference is real money.

You access your money through a website or mobile app, and transfers to your regular checking account take one to three business days. You cannot walk into a branch and withdraw cash, but you can move money out whenever you need it. There is no lock-in period and no penalty for withdrawals.

Key Takeaways

  • Online banks—Marcus, Ally, American Express, Capital One 360, and Discover—consistently offer rates 10 to 50 times higher than traditional bank savings accounts.
  • The rate you see today will change within weeks as the Federal Reserve adjusts its benchmark rate, so compare current rates at the time you open an account, not based on historical data.
  • You manage your account online or through an app; transfers to another bank take one to three business days, and there are no withdrawal penalties or minimum balances at most providers.
  • FDIC insurance covers up to $250,000 per depositor at each bank, so if you have more than that, you need accounts at multiple institutions.

How rates differ between banks and why they change

Every bank sets its own rate, and they do not all move at the same speed when the Federal Reserve changes its benchmark. One week, Marcus might lead at 4.75% APY while Ally sits at 4.50%. The next week, Ally raises to 4.80% and Marcus stays put. This is not random—banks are competing for deposits, and they raise rates when they need more money or lower them when they have enough.

The Federal Reserve's actions set the floor and ceiling. When the Fed raises its benchmark rate, banks have more room to pay depositors more. When the Fed cuts rates, banks cut what they pay you. But the timing is not automatic. A bank might wait two weeks after a Fed cut before lowering your rate, or it might cut when ready. You have no control over this, but you can move your money to a different bank if another one offers more.

Rate comparison sites like Bankrate, DepositAccounts, and NerdWallet show current rates across dozens of banks, updated daily. These are free to use and do not require you to enter personal information. Check the rate on the day you plan to open an account, because the rate you see on Monday may be different by Friday.

What to check before opening an account

The APY is not the only thing that matters. Check whether the bank charges a monthly fee—most online banks do not, but some traditional banks do. Look at the minimum deposit required to open the account; many online banks have no minimum, while others ask for $25 or $100. Read whether there are limits on how many transfers you can make per month; some banks cap free transfers at six per month, though this rule has loosened in recent years.

Confirm the bank is FDIC insured. Every bank mentioned here is, but it is worth verifying on the FDIC's website by searching the bank name. FDIC insurance protects your money up to $250,000 per depositor per bank. If you have $300,000 to save, you would need accounts at two different banks to keep all of it insured.

Test the app or website before you commit. Open an account, move a small amount of money in, and try a transfer to your checking account. Does the app work on your phone? Is the website straightforward to navigate? Can you reach customer service if something goes wrong? These things matter more than a 0.1% difference in rate.

How to move money between banks without losing interest

When you open a high yield savings account, you will need to link it to a checking account at another bank so you can move money in and out. You do this by providing your checking account number and routing number. The high yield bank then verifies the account by depositing two small amounts (usually under $1 each) and asking you to confirm the amounts.

Once linked, you can transfer money from your checking account to the high yield account, and it will arrive in one to three business days. Interest starts accruing the day the money lands in the high yield account. If you transfer $10,000 on a Monday and it arrives Wednesday, you earn interest starting Wednesday, not Monday.

You can also transfer money out of the high yield account back to your checking account whenever you need it. This also takes one to three business days. Some banks let you set up automatic transfers—for example, moving $500 from checking to savings every payday—so you do not have to remember to do it manually.

Comparing rates across different time periods

High yield savings rates have moved dramatically over the past few years. In 2021, the best rates were around 0.5% APY. By late 2023, they had climbed to 5% or higher. In 2024, rates began falling again as the Federal Reserve cut its benchmark. This matters because it means the rate you lock in today will not stay the same forever.

You do not "lock in" a rate the way you do with a certificate of deposit (CD). Your rate is variable, meaning the bank can lower it at any time. However, you can move your money to a different bank if another one offers more. This is free and takes a few days. Some people move their money every few months to chase the highest rate; others pick a bank and stay put. Both approaches work, depending on how much time you want to spend managing your savings.

If you want a may provide rate that does not change, a CD is the right tool. You lock in a rate for a set period—three months, six months, one year, five years—and the bank cannot lower it. The trade-off is that you cannot withdraw the money without a penalty. High yield savings accounts give you flexibility; CDs give you certainty.

What happens to your money if the bank fails

FDIC insurance means that if the bank fails, the government guarantees your money up to $250,000. This has happened before—during the 2008 financial crisis, several banks failed and FDIC insurance paid depositors in full. It is rare, but it is a real protection.

The $250,000 limit applies per depositor per bank. If you have $250,000 at Marcus and $250,000 at Ally, both are fully insured because they are separate institutions. If you have $500,000 at Marcus, only $250,000 is insured. The FDIC website has a tool called the Electronic Deposit Insurance Estimator (EDIE) that lets you calculate your coverage based on how your accounts are titled.

All the banks mentioned here are well-capitalized and have been operating for years. The risk of failure is very low. But the insurance exists precisely because risk is never zero, and it is good to know your money is protected.

Moving your money if you want to switch banks

If you open an account at one bank and later find a better rate elsewhere, moving your money is straightforward. You initiate a transfer from the new bank, providing your old bank's routing number and account number. The new bank pulls the money out, and it arrives in two to three business days. You do not have to call anyone or fill out forms. The old account closes automatically once the balance hits zero, or you can close it yourself.

Some banks offer sign-up bonuses—$100, $150, or more—if you open an account and deposit a certain amount within a set timeframe. These bonuses are separate from the interest rate and can add up if you are moving money anyway. Read the fine print carefully: some bonuses require you to keep the account open for a certain number of months, or they will claw back the bonus if you close it too soon.

Frequently Asked Questions

Can I withdraw money from a high yield savings account whenever I want?

Yes. There is no lock-in period and no penalty for withdrawals. The money takes one to three business days to reach your checking account. You can withdraw as much as you want, as often as you want. The only limit some banks impose is on the number of free transfers per month, though most have removed this restriction.

What is the difference between a high yield savings account and a money market account?

Money market accounts often pay slightly higher rates but may require a larger minimum deposit and limit your withdrawals more strictly. High yield savings accounts are simpler: lower minimums, more flexibility, and rates that are usually competitive. For most people, a high yield savings account is the better choice.

Do I have to pay taxes on the interest I earn?

Yes. Interest earned in a high yield savings account is taxable income. The bank will send you a 1099-INT form at the end of the year showing how much interest you earned, and you report it on your tax return. This is true whether you withdraw the money or leave it in the account.

What happens if I deposit more than $250,000?

The FDIC insures only $250,000 per depositor per bank. If you have more than that, open accounts at multiple banks. For example, $250,000 at Marcus and $250,000 at Ally means all of it is insured. The FDIC's website has a calculator to help you figure out your coverage.

Can I set up automatic transfers to my high yield savings account?

Yes. Most banks let you schedule recurring transfers from your checking account—for example, $500 every payday. You set this up in the app or website, and the bank handles it automatically. This is a good way to build savings without having to remember to transfer money manually.