Banks and credit unions that offer HYSAs

High-yield savings accounts live at three types of institutions: online banks, traditional banks with online divisions, and credit unions. Online banks—companies like Marcus, Ally, and Discover—typically offer the highest rates because they have no physical branches to maintain. Traditional banks like Chase, Bank of America, and Wells Fargo offer HYSAs alongside their regular savings accounts, though their rates are usually lower than online competitors. Credit unions also offer high-yield options, though availability and rates vary by membership and institution.

You do not need to choose between these categories based on safety. All deposits up to $250,000 are insured by the FDIC at banks or the NCUA at credit unions, regardless of where the institution sits. The real difference is rate, features, and how you prefer to bank.

Key Takeaways

  • Online banks typically offer the highest APY on HYSAs because they operate without physical branches, but you cannot deposit cash in person.
  • Traditional banks offer HYSAs with lower rates but let you walk into a branch and deposit cash or speak to someone in person.
  • Credit unions may offer competitive rates if you are a member, but you need to meet membership requirements first.
  • All deposits are FDIC or NCUA insured up to $250,000, so the institution type does not affect safety—only rate and convenience.
  • You can open most HYSAs online in 10 to 15 minutes with an ID, proof of address, and a funding source.

Online banks: highest rates, no branches

Online banks have no physical locations, which means lower overhead and higher rates passed to you. Marcus (owned by Goldman Sachs), Ally, Discover, American Express Personal Savings, and Wealthfront Cash Account are common names. Rates at these institutions typically sit 4.5% to 5.35% APY, though this changes weekly based on Federal Reserve decisions and competition.

The trade-off is that you cannot walk in to deposit cash. You fund the account by transferring money from another bank, mailing a check, or using their mobile app. Withdrawals work the same way—you transfer money out to another account. If you rarely handle cash and do most banking online, this is usually not a problem. If you get paid in cash or need to deposit checks regularly, you will need a workaround.

Opening takes 10 to 15 minutes. You will need a government-issued ID, proof of address (recent utility bill or lease), and the routing and account number of a bank account to fund from. Some institutions ask for your Social Security number to run a credit check, though this is a soft inquiry and does not affect your credit score.

Traditional banks: lower rates, in-person access

Banks like Chase, Bank of America, Wells Fargo, and Citi offer HYSAs as part of their product lineup. Their rates are typically lower—often 4.0% to 4.75% APY—because they maintain branches and customer service staff. The advantage is that you can walk into a location to deposit cash, get a cashier's check, or speak to someone face-to-face if something goes wrong.

Many people already have a checking account at a traditional bank. Opening a HYSA at the same institution means your money stays in one place, one login, and one statement. You can move money between accounts when ready. Some banks offer small perks like waived fees or slightly higher rates if you maintain a minimum balance or set up direct deposit.

If you are choosing between a traditional bank and an online bank purely for rate, the online bank will usually win by 0.5% to 1% APY. Over a year, that difference adds up—on $10,000, the gap is roughly $50 to $100 in interest. Whether that is worth giving up branch access depends on how you actually bank.

Credit unions: membership required, competitive rates

Credit unions are member-owned cooperatives that often offer rates competitive with online banks. Navy Federal, Connexus, and Pentagon Federal are large credit unions known for strong savings rates. However, you must meet membership requirements to join—these vary widely. Some credit unions are open to anyone in a geographic area. Others require you to work for a specific employer, belong to an organization, or have a family member who is already a member.

Once you are a member, opening a HYSA is straightforward and works much like a traditional bank. You can often visit a branch in person, and rates are frequently 4.5% to 5.25% APY. The catch is the membership barrier—you cannot straightforward decide to bank there without checking whether you may have access to first.

If you already may have access to for membership at a credit union with strong rates, it is worth comparing their HYSA to online banks. If you do not may have access to, you would need to join a different credit union or choose between online banks and traditional banks.

How to compare rates and features across institutions

APY is the most visible number, but it is not the only one that matters. Check whether the rate is promotional (good for three months, then drops) or ongoing. Most online banks publish their current rate on the homepage—if you see a rate, ask whether it applies to all new accounts or only balances above a certain threshold. Some institutions offer 5.35% on balances up to $25,000 and 4.75% on anything above that.

Look at the minimum balance required to open. Most online banks have no minimum—you can open with $1. Some traditional banks require $500 or $1,000 to avoid a monthly fee. Credit unions vary. If you are starting with a small amount, a no-minimum account saves you from fees.

Check the withdrawal rules. Federal law once limited savings account withdrawals to six per month, but that rule was suspended in 2020. Most institutions now allow unlimited withdrawals, but a few still cap them. If you plan to move money in and out frequently, confirm the institution does not charge per withdrawal or limit how many you can make.

Finally, test the user experience before committing. Can you open an account on your phone in five minutes, or does it require a computer? Does the app let you transfer money easily? Can you see your balance and history clearly? A slightly lower rate at an institution you actually enjoy using often beats a 0.1% higher rate at a place with a clunky interface.

Moving money into and out of your HYSA

Once you open an account, you need to fund it. Most HYSAs accept transfers from another bank account—you provide your account number and routing number, and money moves in one to three business days. Some institutions offer faster transfers (same-day or next-day) if you set up the connection through their app.

If you want to deposit cash, your options depend on the institution. Online banks do not accept cash deposits directly, but some partner with retailers like MoneyGram or Walmart to let you deposit cash for a small fee. Traditional banks and credit unions let you deposit cash at any branch. If you get paid in cash regularly, this is a real consideration.

Withdrawals work the same way—you transfer money back to your checking account, and it arrives in one to three business days. Some institutions offer faster withdrawals if you use their app. You cannot write checks against a savings account, so you cannot use it like a checking account. The point is to keep the money separate and earning interest, not to spend from it constantly.

What happens after you open

Once your account is open and funded, the interest compounds daily and deposits monthly. You do not need to do anything—the rate applies automatically. If the Federal Reserve raises or lowers rates, your institution will adjust your APY accordingly. You will see the new rate posted on their website and in your account, usually within a few days of the Fed's decision.

If your rate drops significantly and you find a better option elsewhere, you can move your money. There is no penalty for closing a savings account. You straightforward request a transfer to your new institution, and the old account closes. This takes a few days. Some people keep accounts at multiple institutions to lock in rates or to have a backup if one institution has a technical issue.

Your HYSA is separate from your checking account, so you will not accidentally spend the money. The separation is the whole point—it keeps your savings out of reach of daily spending but still accessible if you need it. Most people use a HYSA for an emergency fund, a down payment they are saving for, or money they want to grow without taking investment risk.

Frequently Asked Questions

Can I open a HYSA if I have bad credit?

Yes. Most banks and credit unions do not check your credit score to open a savings account. Some institutions run a soft inquiry (which does not affect your credit) to verify your identity, but this is different from a credit check. If you have been denied a bank account before, ask the institution why before explore elsewhere.

What if I want to deposit cash but use an online bank?

Some online banks partner with retailers to accept cash deposits for a small fee—usually $1 to $3 per deposit. Alternatively, you can deposit cash at your current bank's branch, then transfer the money to your online HYSA. This takes an extra day but costs nothing.

Do I pay taxes on the interest I earn?

Yes. Interest from a savings account is taxable income. Your bank will send you a 1099-INT form at the end of the year if you earned $10 or more in interest. You report this on your tax return. The amount is usually small, but it counts.

Can I move my money between HYSAs if rates change?

Yes. You can transfer money from one HYSA to another at any time with no penalty. It takes one to three business days. Some people move money to chase the highest rate, though the difference between a 5.0% and 5.35% account is small unless you have a large balance.

What if the bank fails?

Your deposits are insured by the FDIC (at banks) or NCUA (at credit unions) up to $250,000 per account. If the institution fails, you get your money back. This has not happened to a major bank in decades, but the insurance exists to protect you if it does.