Where to find a high-yield savings account

High-yield savings accounts are offered by three types of banks: online-only banks, traditional banks with online divisions, and credit unions. Online-only banks like Marcus, Ally, and American Express Personal Savings typically offer the highest rates because they have lower overhead costs than brick-and-mortar branches. Traditional banks like Chase, Bank of America, and Wells Fargo offer high-yield accounts, but their rates are usually lower than online competitors. Credit unions, which are member-owned rather than shareholder-owned, sometimes offer competitive rates through their savings products.

The bank you choose affects not just your rate but also how you access your money, what fees you might pay, and whether you have a physical location to visit. Some people prioritize the highest rate and don't mind banking entirely online. Others want the option of walking into a branch or prefer to keep all their accounts in one place.

Key Takeaways

  • Online-only banks typically offer the highest rates on savings accounts because they operate without physical branches.
  • Traditional banks offer high-yield accounts but usually at lower rates than online competitors, though you can visit a branch in person.
  • Credit unions may offer competitive rates and often have lower fees, but availability depends on your membership may be able to access.
  • The actual rate you receive can change at any time, so comparing current rates across multiple banks matters more than the bank's name.
  • FDIC insurance protects deposits up to $250,000 at banks and NCUA insurance protects deposits at credit unions, so account safety does not depend on which type of institution you choose.

Online-only banks and their rates

Online-only banks have no physical locations, which means lower costs for rent, staff, and equipment. They pass some of those savings to customers through higher interest rates. Banks in this category include Marcus (owned by Goldman Sachs), Ally Bank, American Express Personal Savings, Discover Bank, and Wealthfront Cash Account. Each sets its own rate independently, and rates change frequently—sometimes weekly.

The trade-off is that you cannot deposit cash in person or speak to someone face-to-face at a branch. Most online banks let you deposit checks by taking a photo with your phone, and they offer customer service by phone, email, or chat. If you rarely need to deposit cash and are comfortable managing your account through an app or website, online-only banks are usually where you will find the highest rates.

Traditional banks with high-yield options

Major banks like Chase, Bank of America, Wells Fargo, and Citibank all offer high-yield savings accounts or money market accounts. The rates are typically lower than online-only competitors—sometimes by a full percentage point or more—but you get the benefit of walking into a branch to deposit cash, speak with a banker, or handle complex transactions in person.

Some traditional banks offer different rates depending on your account balance or whether you have other products with them, like a checking account or mortgage. A few have tiered rates, meaning you earn a higher rate once you reach a certain balance threshold. Before opening an account, check whether the bank requires a minimum balance to earn the advertised rate, because some do and some do not.

Credit unions and member-owned institutions

Credit unions are owned by their members rather than shareholders, which sometimes allows them to offer better rates and lower fees than traditional banks. However, you can only join a credit union if you meet their membership requirements—usually based on where you live, work, or go to school, or membership in a specific organization.

Credit unions vary widely in their rates and products. Some offer high-yield savings accounts that compete with online banks, while others offer rates similar to traditional banks. Your deposits are protected by NCUA insurance up to $250,000, the same protection level as FDIC insurance at banks. If you are already a credit union member, it is worth checking their current savings rates before opening an account elsewhere.

How to compare rates across banks

The advertised rate is only part of the picture. Before opening an account, check three things: the current annual percentage yield (APY), any minimum balance requirement, and whether the rate is promotional or permanent. A promotional rate might be high for three months and then drop, so read the fine print or call and ask how long the rate lasts.

Use a rate comparison website like Bankrate, DepositAccounts, or the Federal Deposit Insurance Corporation's BankFind tool to see current rates across multiple banks at once. These sites update frequently, but rates can change between when you check and when you open the account, so verify the rate directly with the bank before funding your account. Also check whether the bank charges monthly maintenance fees, early withdrawal penalties, or fees for transfers—some high-yield accounts charge nothing, while others charge $5 to $10 per month.

FDIC and NCUA insurance protection

Whether you choose an online bank, traditional bank, or credit union, your deposits are insured by a federal agency. Banks are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000 per account holder per bank. Credit unions are insured by the National Credit Union Administration (NCUA) up to the same amount. This means your money is safe even if the bank or credit union fails.

If you have more than $250,000 to save, you can spread it across multiple banks to keep all of it insured. For example, $250,000 at Bank A and $250,000 at Bank B are both fully protected. Some banks offer multiple account types (like a savings account and a money market account) that are insured separately, so you could have $250,000 in savings and $250,000 in a money market account at the same bank and have both fully protected. Ask the bank directly if you are unsure how their accounts are insured.

What happens when rates change

Banks change their rates based on what the Federal Reserve does with its benchmark interest rate. When the Fed raises rates, banks usually raise their savings rates too—sometimes within days. When the Fed lowers rates, banks lower savings rates as well, though often more slowly. You do not have to do anything when your rate changes; the bank adjusts it automatically.

This is why the bank you choose matters less than checking rates regularly. A bank offering the highest rate today might not offer it next month. If you find a better rate elsewhere, you can open a new account and transfer your money. There is no penalty for moving your savings to a different bank, and the process usually takes three to five business days.

Frequently Asked Questions

Can I have a high-yield savings account if I do not have a checking account?

Yes. Most banks let you open a savings account on its own without a checking account. Some online banks only offer savings accounts and do not have checking products at all. A few traditional banks may encourage you to open both, but they cannot require it.

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

Both earn interest, but money market accounts sometimes come with a debit card or checkbook, while savings accounts usually do not. Money market accounts may also have limits on how many withdrawals you can make per month. Rates are often similar between the two, so choose based on whether you need check-writing or debit card access.

If I move my money to a different bank, do I lose the interest I already earned?

No. Interest you have already earned stays in your account. When you transfer money out, you take that interest with you. The new bank will start paying interest at its rate once the money arrives, which usually takes three to five business days.

Do online banks have customer service if something goes wrong?

Yes. Online banks offer customer service by phone, email, and live chat, usually during business hours and sometimes 24/7. Response times vary by bank. If you strongly prefer speaking to someone in person, a traditional bank with branches may be a better fit, though you will likely earn a lower rate.

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

Yes. Most banks let you set up automatic transfers from a checking account at the same bank or a different bank. You can schedule them weekly, biweekly, monthly, or on any date you choose. This is a useful way to move money into savings without having to remember to do it manually.