The banks offering the highest rates 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, American Express Personal Savings, Discover Bank, and Wealthfront Cash Account have historically offered rates well above the national average. The specific rate each one pays changes weekly or monthly, so the "highest" bank today may not be the highest next month.
The reason online banks can pay more is straightforward: they have no physical branches to maintain, no tellers to employ, and lower overhead costs overall. They pass some of that savings to depositors as higher interest rates. Traditional banks like Chase, Bank of America, and Wells Fargo typically pay rates close to zero on savings accounts because they rely on deposit volume rather than rate competition.
You can find current rates by visiting each bank's website directly or by checking rate-tracking sites that update daily. The difference between a 4.5% rate and a 5.0% rate matters: on $10,000, that is roughly $50 per year in additional interest. On $100,000, it is $500 per year.
Key Takeaways
- Online banks consistently pay higher rates than traditional banks because they operate with lower costs and no physical locations.
- Rates change frequently—sometimes weekly—so the highest-paying bank this month may not be the highest next month.
- You can compare current rates directly on bank websites or through rate-tracking tools that update daily.
- The difference between rates matters: moving $50,000 from a 0.01% account to a 4.75% account generates roughly $2,375 more per year in interest.
- All deposits at FDIC-insured banks are protected up to $250,000 per depositor, regardless of which bank you choose.
How to compare rates across banks
Start by checking the website of each bank you are considering. Look for the APY (annual percentage yield) listed on the savings account product page—not the interest rate, which is slightly different. The APY already includes the effect of compounding, so it is the number that matters for your actual earnings.
Write down the APY, any monthly fees, and the minimum deposit required. Some banks charge a monthly maintenance fee that erases the benefit of a higher rate; others have no minimum at all. A bank paying 4.8% with a $25 monthly fee is worse than one paying 4.5% with no fee.
Check whether the rate is promotional (temporary, usually for new customers) or standard (ongoing). Promotional rates often drop after three to six months. Read the fine print to see when the rate changes and what the standard rate will be after the promotion ends.
Online banks versus traditional banks
Online banks have no physical locations, which means you cannot walk in and deposit cash or speak to someone in person. You deposit money by transfer from another bank account, mobile check deposit, or ACH transfer. Withdrawals work the same way—you transfer money back to your checking account or another bank. This takes one to three business days.
Traditional banks have branches where you can deposit cash when ready and speak to a person. They also typically offer checking accounts, credit cards, and loans all in one place. The trade-off is that their savings rates are much lower because they do not need to compete on rate to attract deposits.
Some people keep both: a high yield savings account at an online bank for money they do not need when ready, and a checking account at a traditional bank for everyday spending and cash deposits. This gives you the higher rate without sacrificing convenience.
What happens when the Federal Reserve changes rates
The Federal Reserve sets a target range for the federal funds rate, which is the rate banks charge each other for overnight loans. When the Fed raises rates, banks can afford to pay depositors more. When the Fed cuts rates, banks lower what they pay you.
Online banks typically pass Fed changes to depositors faster than traditional banks do. If the Fed cuts rates by 0.25%, an online bank might lower its savings rate by 0.25% within days. A traditional bank might take weeks or might not lower rates at all if they are already very low.
This means the rate you see today is not may provide to stay the same. If you lock in a 5.0% rate and the Fed cuts rates by 1.0%, your rate will likely drop to around 4.0%. This is normal and happens across all banks.
FDIC insurance and account safety
Every bank mentioned here is FDIC-insured, which means your deposits are protected up to $250,000 per depositor, per bank. If the bank fails, the FDIC guarantees you get your money back up to that limit. This protection applies whether the bank is online or has branches.
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 Marcus and $250,000 at Ally are both fully protected. You can also open a joint account at one bank (which gets a separate $250,000 of coverage) or a trust account (which also gets separate coverage).
Online banks are as safe as traditional banks from a deposit perspective. The only real difference is that you cannot walk in and see the building, but your money is just as protected.
Special account features to consider
Some high yield savings accounts come with extras. American Express Personal Savings, for example, does not charge overdraft fees because it is a savings account, not a checking account. Wealthfront Cash Account offers a debit card so you can spend directly from your savings without transferring money first. Marcus has no minimum deposit and no monthly fees.
Ally offers a "buckets" feature that lets you divide your savings into separate virtual accounts within one account—useful if you are saving for multiple goals. Discover Bank offers a money market account (similar to a savings account but with check-writing privileges) alongside its high yield savings option.
These features do not change the core function—earning interest on your money—but they can make the account more convenient depending on how you plan to use it. Decide what matters to you: the highest rate, no fees, no minimum, or specific features like a debit card.
How to move money into a high yield account
Once you choose a bank, you will need to link it to an existing bank account you already have. This usually means providing your checking account number and routing number, then confirming two small deposits (typically under $1 each) that the new bank sends to your old bank. You confirm the amounts, and the link is verified.
After that, you can transfer money from your checking account to your new high yield savings account. The transfer typically takes one to three business days. Some banks let you set up automatic transfers—for example, moving $500 every payday into savings automatically.
You can also deposit checks by taking a photo with your phone (mobile check deposit) at most online banks. Cash deposits are not possible at online banks, so if you receive cash regularly, you would need to deposit it at a traditional bank first, then transfer it to your high yield account.
Frequently Asked Questions
Can I withdraw money from a high yield savings account whenever I want?
Yes. There are no restrictions on how often you withdraw or how much you take out. The money transfers back to your linked checking account in one to three business days. The only limit is that some banks charge a fee if you make more than six withdrawals per month, though this rule is less common now than it used to be.
What is the difference between APY and interest rate?
Interest rate is the percentage the bank pays you. APY (annual percentage yield) is the interest rate plus the effect of compounding—meaning interest earned on interest. APY is always slightly higher than the interest rate and is the number you should use to compare banks, because it shows your actual earnings over a year.
Do I have to keep a minimum balance in a high yield savings account?
It depends on the bank. Many online banks like Marcus and Ally have no minimum. Others require $1,000 or $2,500 to open the account or to earn the advertised rate. Check the account details before you open it. If you cannot meet the minimum, choose a different bank.
What happens to my interest if I close the account?
You keep all interest you have already earned. If you close the account mid-month, you earn interest only through the day you close it. Interest is calculated daily but paid monthly, so you will see the final payment in your account before the closure is complete.
Are online banks safe if they are not as well-known as Chase or Bank of America?
Yes. As long as the bank is FDIC-insured (which all the banks mentioned here are), your deposits are protected up to $250,000 even if the bank fails. FDIC insurance does not depend on how famous the bank is. Many online banks are owned by larger financial companies—Marcus is owned by Goldman Sachs, for example—which adds another layer of stability.