Editor's Note: APYs listed in this article are up-to-date as of the time of publication. They may fluctuate (up or down) as the Fed rate changes. CNBC Select will update as changes are made public.
With a high-yield savings account, you can get a solid interest rate and your money grows even faster thanks to compound interest — which lets you earn interest on interest. The higher your rate, the faster your money grows and the better return you earn on your money.
To determine the top high-yield savings accounts, CNBC Select compared those that have an above-average APY, FDIC insurance, zero monthly maintenance fees and low (or no) minimum balance requirements. (See our methodology for more information on how we choose the best high-yield savings accounts.)
Best high-yield savings accounts
- Best for earning a high APY: Western Alliance Bank High-Yield Savings Account
- Best for account features: LendingClub® High-Yield Savings
- Best for no minimum deposit: Newtek Bank Personal High Yield Savings
- Best for ATM card: UFB Secure Savings
- Best for easy access to your cash: Synchrony Bank High Yield Savings
- Best for no fees: Marcus by Goldman Sachs® High-Yield Online Savings Account
- Best for low deposits: Mango Savings™
- Best for welcome bonus: SoFi® Checking and Savings
- Best for checking/savings combo: Ally Bank® Savings Account
- Best for earning airline miles: Bask Bank Mileage Savings Account
- Best if you want extra help saving: Varo Online Savings Account
- Best from a brick-and-mortar bank: Capital One® 360 Performance Savings
- Best from a big bank: American Express® High Yield Savings Account
Compare offers to find the best savings account
Best for earning a high APY
Western Alliance Bank High-Yield Savings Account
Annual Percentage Yield (APY)
5.22% APY
Minimum balance
$1 minimum deposit
Monthly fee
None
Maximum transactions
Up to 6 transactions each month
Excessive transactions fee
The bank may charge fees for non-sufficient funds
Overdraft fee
No overdraft fee
Offer checking account?
No
Offer ATM card?
No
Terms apply.
Pros
- Strong APY
- Low minimum deposit required
- No monthly fees
Cons
- Bank may charge non-sufficient funds
- Doesn't offer checking account or ATM access
- Accounts are opened and managed on Raisin.com
Who's this for? The Western Alliance Bank High-Yield Savings Account account is for you if you're focused on maximizing your returns as it offers one of the highest savings rates we found and has just a $1 minimum deposit to open an account.
Standout benefits: There's no cap to earning Western Alliance Bank's high APY and there are no monthly fees.
Best for account features
LendingClub High-Yield Savings
Annual Percentage Yield (APY)
5.00%
Minimum balance
No minimum balance requirement after $100.00 to open the account
Monthly fee
None
Maximum transactions
None
Excessive transactions fee
None
Overdraft fees
N/A
Offer checking account?
Yes
Offer ATM card?
Yes
Terms apply.
Pros
- Strong APY
- No minimum balance required
- No monthly fees
- Free ATM card and no ATM fees
Cons
- $100 minimum opening deposit required, though there's no minimum balance after that
- No physical branch locations
Who's this for? Unlike many savings accounts, LendingClub High-Yield Savings offers a free ATM card and never charges any ATM fees. This makes it easy to access your savings account and withdraw money whenever you want.
Standout benefits: LendingClub offers an attractive APY, along with zero monthly fees and no minimum balance requirement after the $100 deposit to open the account. You can use your funds to pay bills, send money to friends and family and make internal and external transfers, which is less common for a savings account.
Best for no minimum deposit
Newtek Bank Personal High Yield Savings
Annual Percentage Yield (APY)
5.25% APY
Minimum balance
$0.01 to earn interest
Monthly fee
None
Maximum transactions
Up to 6 free withdrawals or transfers per statement cycle; transaction amount limits apply; withdrawals from your account can only be transferred to the original external funding source
Excessive transactions fee
None
Overdraft fee
None
Offer checking account?
Only a business checking account
Offer ATM card?
Yes, if have a Newtek checking account
Terms apply.
Pros
- Strong APY
- No minimum deposit and low minimum balance
- No monthly fees
- Offers business checking account and ATM access
Cons
- Transfer limit
- Only offers a business checking account
- Mobile deposits on app only available for business accounts
Who's this for? Newtek Bank Personal High Yield Savings allows you to earn one of the highest savings returns with no minimum deposit required.
Standout benefits: With Newtek, you can earn a respectable APY with a minimum balance requirement of just $0.01 to earn interest and no monthly fees. There's no cap on how much interest you can earn with this APY.
Best for ATM card
UFB Secure Savings
Annual Percentage Yield (APY)
Up to 5.25% APY on any savings balance; add UFB Freedom Checking and meet checking account qualifications to get an additional up to 0.20% APY on savings
Minimum balance
$0, no minimum deposit or balance needed for savings
Fees
No monthly maintenance or service fees
Overdraft fee
Overdraft fees may be charged, according to the terms; overdraft protection available
ATM access
Free ATM card with unlimited withdrawals
Maximum transactions
6 per month; terms apply
Terms apply.
Read our UFB Secure Savings review.
Pros
- Strong APY on any savings balance
- Get an additional up to 0.20% APY on savings when you add UFB Freedom Checking and set up direct deposit of $5,000 monthly, maintain minimum balance of $10,000 and make 10 debit card transactions per statement cycle.
- No minimum deposit or balance required for savings
- No monthly fees
- Free ATM card with unlimited withdrawals
- Free transfers between direct deposit accounts
- Online and SMS banking available
- Mobile check deposits
- Security features include fraud and anti-virus protection, SSL encryption for secure connection, automatic logouts after inactivity
Cons
- Potential overdraft fee, though overdraft protection is offered
- Certain types of withdrawals and transfers may be limited
- $10 excessive transaction fee per transaction over 6/month
- No physical branch locations
Who's this for? UFB Secure Savings is ideal if you want to earn one of the highest returns and get ATM access. Although there are no physical branches, you can get a free ATM card.
Standout benefits: Along with an ATM card, you'll get a competitive APY on all balance tiers with no cap, no monthly fees and no minimum deposit requirement. You can earn even more interest on your savings with a UFB checking account.
Best for easy access to your cash
Synchrony Bank High Yield Savings
Annual Percentage Yield (APY)
4.75% APY
Minimum balance
None
Monthly fee
None
Maximum transactions
Up to 6 free withdrawals or transfers per statement cycle
Excessive transactions fee
None
Overdraft fee
None
Offer checking account?
No
Offer ATM card?
Yes
Terms apply.
Pros
- Strong APY
- No minimum balance or deposit
- No monthly fees
- Easy ATM access
Cons
- No option to add a checking account
Who's this for? The Synchrony Bank High Yield Savings account stands out if you're seeking convenient withdrawal options. You can access your money by ATM via an optional ATM card, wire transfer (up to three free per statement cycle) or through an electronic transfer to or from accounts you have at other banks.
Standout benefits: This account has no monthly fees or minimum deposits. Though you're limited to six free withdrawals or transfers per statement cycle, Synchrony Bank allows you to conduct unlimited transactions at an ATM. The bank won't charge an ATM fee, but the ATM provider may. For these charges, Synchrony Bank refunds ATM fees in the U.S. up to $5 per statement cycle.
Best for no fees
Marcus by Goldman Sachs High Yield Online Savings
Annual Percentage Yield (APY)
4.40% APY
Minimum balance
None
Monthly fee
None
Maximum transactions
At this time, there is no limit to the number of withdrawals or transfers you can make from your online savings account
Excessive transactions fee
None
Overdraft fee
None
Offer checking account?
No
Offer ATM card?
No
Terms apply.
Pros
- Strong APY
- No minimum balance or deposit
- No monthly fees
- No limit on withdrawals or transfers
- Easy-to-use mobile banking app
- Offers no-fee personal loans
Cons
- Higher APYs offered elsewhere
- No option to add a checking account
- No ATM access
Who's this for? Marcus by Goldman Sachs High-Yield Online Savings Account offers no fees, no minimum deposit requirement and easy mobile access. It's one of the most straightforward savings accounts to use when all you want to do is grow your money with zero conditions attached.
Standout benefits: Marcus offers a strong APY and there's no limit to the number of withdrawals or transfers you can make from your online savings account.
Best for low deposits
Mango Prepaid Mastercard® savings feature
Annual Percentage Yield (APY)
6.00% APY on up to $2,500 if make signature purchases of $1,500 or more and have a minimum balance of $25 at the end of the month (after, 0.10% APY for balances over $2,500; $5,000 cap)
Minimum balance
$25
Monthly fee
None
Maximum transactions
Up to 6 transfers out each month and transfer amounts to savings apply
Excessive transactions fee
None
Overdraft fee
None
Offer checking account?
No
Offer ATM card?
Yes, offers prepaid debit card
Terms apply.
Pros
- Strong APY
- Low minimum balance
- No monthly fees
- Offers prepaid debit card with ATM access
Cons
- Savings feature only available to Mango cardholders
- Cap on earning high APY
- High APY has requirements
- Low APY for balances over $2,500
- No option to add a checking account
Who's this for? The Mango Savings feature part of offers the Mango Prepaid Mastercard® (issued by Metropolitan Commercial Bank) has one of the highest APYs we found, but only on smaller-sized balances.
Standout benefits: As a cardholder of the Mango Prepaid Mastercard® (issued by Metropolitan Commercial Bank), you have access to a savings feature where you can earn up to 6.00% APY on balances up to $2,500 by meeting two requirements:
- Make a minimum deposit of $25 and have that minimum balance at the end of the month
- Make signature purchases of $1,500 or more on the Mango Prepaid Mastercard each month
If you max your balance to $2,500, that's $150 in interest earnings in a year — which is why we ranked this account the best for making a small deposit (up to $2,500). The APY thereafter is a low 0.10% APY over $2,500, or 2.00% APY for accounts with a $25 average daily balance and signature purchases between $750 and $1,499.99. Regardless, though, we'd recommend shifting other savings beyond the $2,500 to a high-yielding bank account that can get you more than even the 2.00% APY.
The Mango Card has a $5 monthly fee that can be waived if you have $800 or more in direct deposits.
Best for welcome bonus
SoFi Checking and Savings
Annual Percentage Yield (APY)
Members with direct deposit earn 4.60% APY on savings, no minimum balance needed. Members without direct deposit earn 1.20% APY on savings balances, and everyone earns 0.50% APY on checking balances.
Welcome bonus
Earn a $300 welcome bonus when you direct deposit a total of $5,000 or more within 25 days of your first direct deposit. Get a $50 welcome bonus when you direct deposit between $1,000 and $4,999.99 within 25 days of your first direct deposit.
Fees
No monthly fee and no excessive transaction fees.
No-fee overdraft protection
No-fee Overdraft Coverage up to $50 for SoFi members with $1,000 or more in total monthly direct deposits. Purchases exceeding $50 are declined.
Offer ATM card?
Yes, this account offers a debit card that allows purchases and ATM withdrawals. Terms apply.
Offer checking account?
Yes, bundled with savings account.
Maximum transactions
Up to 6 free withdrawals or transfers per statement cycle. Transaction amount limits apply.
Pros
- A welcome bonus of $300 with direct deposit totaling $5,000 or more within 25 days of your first direct deposit. Or a welcome bonus of $50 with direct deposit totaling between $1,000 and $4,999.99 within 25 days of your first direct deposit
- Strong 4.60% APY with direct deposit
- No minimum balance or deposit needed
- No monthly fees
- Comes with checking account and ATM access
- Receive your pay check in your account up 2 days early automatically when set up direct deposit
- Save change automatically with Roundups and set savings goals with Vaults
- No foreign transaction fees
- FDIC insurance up to $2 million through the SoFi Insured Deposit Program
Cons
- Non-direct deposit APYs are low compared to other high-yield savings accounts
- No reimbursement for out-of-network ATM fees
- No physical branches
Who's this for? The SoFi Checkings and Savings account stands out for offering a valuable welcome bonus after you set up direct deposit payments: Earn $50 when setting up a direct deposit of $1,000 to $4,999.99 and earn $300 when setting up a direct deposit of $5,000 or more, both within 25 days of your first direct deposit.
Standout benefits: As a SoFi member who sets up direct deposit, you can earn a higher APY on your savings balances. There are no account or overdraft fees, up to $2 million of additional FDIC insurance and up to two day early paychecks.
Best for checking/savings combo
Ally Bank Savings Account
Annual Percentage Yield (APY)
4.20% APY
Minimum balance
None
Monthly fee
None
Maximum transactions
Unlimited withdrawals or transfers per statement cycle
Excessive transactions fee
$10 per transaction
Overdraft fee
None
Offer checking account?
Yes
Offer ATM card?
Yes, if have an Ally checking account
Terms apply.
Read our Ally Bank Savings Account review.
Pros
- Strong APY
- No minimum balance or deposit
- No monthly fees
- Unlimited withdrawals or transfers
- Option to add a checking account with ATM access
Cons
- Higher APYs offered elsewhere
- $10 excessive transactions fee
Who's this for? Ally Bank is a good choice if you're looking to do all your banking in one place. While the Ally Bank Savings Account is a decent high-yield account on its own, you can enjoy even more benefits if you also have an Ally Bank Spending Account (Ally's checking account product). An Ally checking and savings account gives you access to over 43,000 free Allpoint ATMs, making it easy to withdraw cash. If you only have an Ally savings account, you won't have access to a debit card. Ally also reimburses out-of-network ATM fees up to $10 per month.
Standout benefits: Ally's savings account offers savings boosters and buckets, zero monthly fees or minimum balance requirements and 24/7 customer support.
Best for earning airline miles
Bask Mileage Savings Account
Annual Percentage Yield (APY)
Earn 2.5 American Airlines AAdvantage® miles for every $1 saved annually instead of interest.
Minimum balance
None
Monthly fee
None
Maximum transactions
Up to 6 withdrawals or transfers per statement cycle
Overdraft fees
N/A
Offer checking account?
No
Offer ATM card?
No
Terms apply.
Pros
- Earn American Airlines AAdvantage miles instead of cash
- No minimum balance
- No monthly fees
Cons
- No option to add a checking account
- No ATM access
Who's this for? If you're a frequent traveler, opt for the Bask Mileage Savings Account to earn American Airlines AAdvantage® miles back instead of interest. With the mileage savings account, you'll earn 2.5 miles for every $1 saved annually. You can use these miles for flights on American Airlines or any of its 20+ partner airlines. So, you can effectively fund your next vacation without any spending.
Standout benefits: If you want to maximize your interest-earning potential, there's also the Bask Interest Savings Account with a respectable 5.10% APY to all savings account holders. Neither the Mileage Savings or Interest Savings accounts have monthly fees.
Best if you want extra help saving
Varo Savings Account
Annual Percentage Yield (APY)
Begin earning 3.00% APY and qualify to earn 5.00% APY if meet requirements
Minimum balance
$0.01 to earn interest
Monthly fee
None
Maximum transactions
Up to 6 free withdrawals or transfers per statement cycle
Excessive transactions fee
None
Overdraft fee
None
Offer checking account?
Yes
Offer ATM card?
Yes, if have a Varo Bank Account
Terms apply.
Read our Varo Savings Account review.
Pros
- Strong APY and option to earn even higher
- No minimum deposit and low minimum balance
- No monthly fees
- Option to add a checking account with ATM access
- Offers 2 programs to help automate your savings
Cons
- Have to meet requirements to earn higher APY
- Cash deposits are only available through third-party services, which charge a fee
Who's this for? With the Varo Online Savings Account, you get access to two programs that automatically transfer money from your Varo bank account to your savings account: Save Your Pay, which automatically transfers a percentage of their paycheck into your savings, and Save Your Change, which rounds up checking account transactions to the nearest dollar and transfers the difference to savings.
Standout benefits: The Varo Online Savings Account offers zero fees or minimums and up to 5.00% APY on up to a balance of $5,000, and 3.00% APY on everything else. To earn the 5.00% APY, you must have at least $1,000 in monthly direct deposits and a positive balance at the end of the month in your Varo bank accounts.
Best from a brick-and-mortar bank
Capital One 360 Performance Savings™
Annual Percentage Yield (APY)
4.25% APY
Minimum balance
None
Monthly fee
None
Maximum transactions
Up to 6 free withdrawals or transfers per statement cycle
Excessive transactions fee
None
Overdraft fee
None
Offer checking account?
Yes
Offer ATM card?
Yes, if have a Capital One checking account
Terms apply.
Pros
- Strong APY
- No minimum balance or deposit
- No monthly fees
- Option to add a checking account with ATM access
- Has physical branch locations, plus Capital One® Cafés
- Has a top-rated mobile app
- Offers mobile check deposit
- Users can take advantage of free credit monitoring service
Cons
- Higher APYs offered elsewhere
Who's this for? Capital One 360 Performance Savings can be a good option if you prefer in-person banking. Unlike many brick-and-mortar savings accounts, it offers a high APY that rivals the returns you can get with online banks. Capital One has about 300 branches, over 70,000 fee-free ATMs nationwide, plus Capital One Cafés you can visit to chat with someone.
Standout benefits: Capital One 360 Performance Savings offers a competitive savings rate, no monthly fees and no minimum requirements.
Best from a big bank
American Express® High Yield Savings Account
Annual Percentage Yield (APY)
4.25% APY as of 4/25/2024
Minimum balance
Min balance to open = $0
Monthly fee
None
Maximum transactions
No limits
Excessive transactions fee
None
Overdraft fee
None
Offer checking account?
No
Offer ATM card?
No
Terms apply.
American Express National Bank is a Member FDIC.
Pros
- Strong APY
- No minimum balance or deposit
- No monthly fees
- 24/7 customer support
- Helpful "Tips & Tools" section on website
Cons
- Higher APYs offered elsewhere
- No option to add a checking account
- No ATM access
- You can't deposit a check via the mobile app
Who's this for? If you prefer sticking to high-yield savings accounts offered by big-name banks because they're familiar, the online American Express High Yield Savings Account stands out.
Standout benefits: With the American Express High Yield Savings Account, you get a good savings rate for no minimum balance and no monthly fees, plus 24/7 customer service.
Find the right savings account for you
More on our top high-yield savings accounts
Western Alliance Bank Savings Account
The Western Alliance Bank High-Yield Savings Account is powered by Raisin, meaning accounts are opened and managed through the Raisin.com platform. The platform manages customers' deposits and withdrawals, bank statements, as well as customer service.
Minimum balance
$1 minimum deposit
Fees
Zero monthly fee or overdraft fee, the bank may charge fees for non-sufficient funds
Maximum transactions
Up to 6 transactions each month
LendingClub High-Yield Savings
LendingClub is known as a peer-to-peer loan lender but outside of personal and business loans, it also offers consumers its high-yield savings account, a rewards checking account and six different CD terms.
Minimum balance
$100 minimum deposit
Fees
Zero monthly fee or excessive transaction fee
Maximum transactions
None
Newtek Bank Personal High Yield Savings
Newtek Bank was formerly National Bank of New York City (NBNYC); it had been acquired and rebranded as a part of NewtekOne. Its one branch is in Miami, FL. Newtek offers banking for both businesses and individuals. In addition to consumers having access to a high-yield savings account, there are also seven different CD terms available.
Minimum balance
$0.01 to earn interest
Fees
Zero monthly fee, excessive transactions fee or overdraft fee
Maximum transactions
Up to 6 free withdrawals or transfers per statement cycle; transaction amount limits apply; withdrawals from your account can only be transferred to the original external funding source
UFB Secure Savings
UFB Direct is the online division of Axos Bank®. In addition to offering a high-yield savings account, UFB also offers a checking account that can boost your savings rate, a money market account and home loans through Axos.
If you're an existing UFB savings customer, note that the bank sometimes changes the name of its savings accounts when it raises the APY, and it does not automatically enroll existing customers into the new account. Any time UFB increases the APY on an account, you should contact the bank to make sure you're enrolled in the account offering the best APY.
Minimum balance
None
Fees
Zero monthly fee, overdraft fee may be charged
Maximum transactions
Six per month
Synchrony Bank High Yield Savings
Synchrony Bank is an online bank offering all sorts of savings products, including its high-yield savings account, a money market account, CDs and specific IRA CDs and IRA money market accounts for retirement.
Minimum balance
None
Fees
Zero monthly fee, excessive transactions fee or overdraft fee
Maximum transactions
Up to six free withdrawals or transfers per statement cycle
Marcus by Goldman Sachs High Yield Online Savings
Marcus is the consumer banking arm of Goldman Sachs and offers its high-yield savings account and CDs, including a high-yield CD, a no-penalty CD and a CD allowing rate bumps. Customer support is available 24/7.
Minimum balance
None
Fees
Zero monthly fee, excessive transactions fee or overdraft fee
Maximum transactions
None
Mango Savings
Mango Financial is online-only and stands out for those who are unbanked with its prepaid debit card access. You also get access to Mango's savings feature with a high APY up to a certain limit.
Minimum balance
$25
Fees
Zero monthly fee, excessive transactions fee or overdraft fee
Maximum transactions
Up to six transfers out each month and transfer amounts to savings apply
SoFi Checking and Savings
SoFi began as a student loan refinancing company, but its offerings have since expanded to personal loans, mortgages, investing, banking, insurance, credit cards, credit monitoring and more. SoFi members get perks like free personalized advice from a financial planner.
Minimum balance
None
Fees
Zero monthly fee, excessive transactions fee, offers no-fee overdraft protection
Maximum transactions
Up to six free withdrawals or transfers per statement cycle and transaction amount limits apply
Ally Savings Account
Ally Bank operates online, offering checking and savings accounts, a money market account, CDs, credit cards with FICO® Score access, mortgages, auto and personal loans, plus investment products. Its customer support line is open 24/7.
Minimum balance
None
Fees
Zero monthly fee or overdraft fee, $10 per excessive transactions
Maximum transactions
10 withdrawals per statement cycle
Bask Bank Mileage Savings Account
Bask Bank is a division of Texas Capital Bank, but operates completely online. Along with its high-yield savings account, Bask also offers four different CD terms and a Bask Mileage Savings Account where you can earn 2.5 American Airlines AAdvantage miles for every $1 saved annually.
Minimum balance
None
Fees
Zero monthly fee
Maximum transactions
Up to six free withdrawals or transfers per statement cycle
Varo Savings Account
Varo Savings is a part of Varo Bank, which is an all-mobile national bank. In addition to its bank account offerings, Varo also has a credit builder card (no credit history required), cash advances and a tax filing service to offer you.
Minimum balance
$0.01 to earn interest
Fees
Zero monthly fee, excessive transactions fee or overdraft fee
Maximum transactions
Up to six free withdrawals or transfers per statement cycle
Capital One 360 Performance Savings
Capital One is a brick-and-mortar bank that offers everything from credit cards to bank accounts, auto loans, business and commercial banking. Capital One has about 300 branches and 70,000-plus fee-free ATMs nationwide.
Minimum balance
None
Fees
Zero monthly fee, excessive transactions fee or overdraft fee
Maximum transactions
Up to six free withdrawals or transfers per statement cycle
American Express High Yield Savings Account
Many people think of credit cards when they hear big-name American Express, but it also offers a high-yield savings account, CDs, a checking account, personal loans and small business accounts.
Minimum balance
None
Fees
Zero monthly fee, excessive transactions fee or overdraft fee
Maximum transactions
None
Compare the best high-yield savings accounts
Savings Account | Minimum Deposit | Monthly Fee | Withdrawal/Transfer Limit | ATM Card with Savings Account? |
---|---|---|---|---|
Ally Bank Savings Account | None | None | Unlimited | No |
American Express High Yield Savings Account | None | None | Unlimited | No |
Bask Bank Mileage Savings Account | None | None | Up to 6/month | No |
Capital One 360 Performance Savings | None | None | Up to 6/month | No |
LendingClub High-Yield Savings | $100 | None | Unlimited | Yes |
Mango Savings | $25 | None | Up to 6/month | Yes |
Marcus by Goldman Sachs High-Yield Online Savings Account | None | None | Unlimited | No |
Newtek Bank Personal High Yield Savings | $0.01 | None | Up to 6/month | No |
SoFi Checking and Savings | None | None | Up to 6/month | Yes |
Synchrony Bank High Yield Savings | None | None | Up to 6/month | Yes |
UFB Secure Savings | None | None | Up to 6/month | Yes |
Varo Online Savings Account | $0.01 | None | Up to 6/month | No |
Western Alliance Bank High-Yield Savings Account | $1 | None | Up to 6/month | No |
What is a high-yield savings account?
A high-yield savings account is like a normal savings account but offers a higher interest rate, or APY, on your cash. With a higher APY, your money grows faster as it sits in your account. Note, however, that unlike with certificates of deposit (CDs), these interest rates are variable, meaning they can go up or down at any time.
Not only does your money earn a better return in a high-yield savings account than in traditional savings, but you still have access to your cash when you need it as you would in a normal savings account. Your money in a high-yield savings account is federally insured by the FDIC or NCUA, which means that deposits up to $250,000 are protected if the bank were to suddenly collapse.
How to choose a high-yield savings account
By nature, when choosing which high-yield savings account to open, you're likely looking for the highest APY offering. While this is an important aspect to consider, make sure you're reading the fine print.
High returns banks advertise may require large minimum deposits to open an account or earn the attractive APY. Ensure any minimum is an amount you're comfortable putting into a savings account. Sometimes, there are also caps that limit the dollar amount that can earn the high APY, thus limiting your interest-earning potential.
How to compare high-yield savings accounts
You can compare high-yield savings accounts by the interest rate they offer, their minimum balance or deposit requirements, their fees and the access they give you to your money.
Pros and cons of having a high-yield savings account
Having a high-yield savings account comes with some benefits and drawbacks. Here are the pros and cons:
High-yield savings account pros
- Above-average APYs
- FDIC insurance up to $250,000 per account
- Funds are accessible up to a limit usually
- Some accounts offer ATM cards for savers
- Easy to find an account with zero monthly fees and zero, or low, minimum requirements
- Most accounts are online and easy to manage on the go with mobile banking apps
- Easy to transfer money between other bank accounts
- Good vehicle for emergency savings or a short-term savings goal
High-yield savings account cons
- APYs are variable and can change at any time
- Some banks impose monthly withdrawal or transfer limits
- Not all accounts offer ATM cards
- Since most accounts are online, there are limited to no in-person banking options available
- While you can transfer your funds from one bank to another, it typically takes 24 to 48 hours
- Not a good way to grow your wealth long-term since inflation can outpace the interest you earn over time
Common high-yield terms you should know
- ACH transfer: When you want to make small and frequent payments electronically (direct deposit, automated bill payments, etc.); typically always free but usually takes at least one business day to complete the transfer.
- Annual percentage yield (APY): The amount of interest an account earns in a year.
- ATM networks: ATMs can either be in-service or out-of-network, depending on which bank you have. When you make a transaction at an ATM that is outside your bank's network, then a fee will most likely be applied by both the ATM operator and your bank.
- Mobile deposit: Instead of going to the bank to deposit a check, you can use your mobile banking app to scan a photo of the check and have the funds immediately deposited into your account. It can sometimes take a day or two for the funds to be accessible.
- Wire transfer: When you want to move funds from one bank account to another and have the money available for use on the same business day; banks usually charge a fee.
FAQs
What is the difference between a high-yield savings account and a traditional savings account?
The main difference between high-yield savings accounts and traditional savings accounts is that high-yield savings accounts offer higher interest rates, which in turn allow your money to grow faster. Also, unlike traditional savings accounts, high-yield savings accounts are generally offered by online banks that don't have physical branch locations.
Why are most high-yield savings accounts online?
High-yield savings accounts, by nature, offer higher returns largely because they operate solely online. They do this because of the savings they get by not paying for overhead costs that traditionally come with operating physical branches, such as the cost of real estate and the additional workers to work in those branches.
How do online savings accounts work?
While online savings accounts offer some of the highest APYs, it's also more tedious to access your money than banking at a brick-and-mortar institution, since you'll usually have to transfer to a checking account to use your money. This is arguably a good thing if you're trying to grow your emergency savings, as you won't have easy access to withdraw from the account.
While it may seem nerve-wracking to have limited access to your savings, one of the big reasons to put your emergency fund into a high-yield account is to watch it grow. The higher your account balance is, the more money you will earn in compound interest over time.
How often do savings rates change?
Interest rates on high-yield savings accounts are variable and can fluctuate at any time. In general, savings rates change every few months after a Federal Reserve committee meets to adjust the federal funds rate.
Are high-yield savings rates increasing?
High-yield savings rates are not increasing at the moment. Rates increased throughout 2023 as the Federal Reserve raised its benchmark rate to tamper with inflation. We saw this reflected in high-yield savings accounts' APYs, which still stand around 5% to even 6% APY. As of early 2024, interest rates are poised to decrease later in the year once the Fed cuts rates.
Can you lose money in a high-yield savings account?
There's a near-zero risk of capital loss when you open a savings account at an FDIC-insured bank, as your account is insured for up to $250,000. Interest rates may decrease, but your cash will not. Theoretically, your money would lose value if the inflation rate is higher than your APY, but that's no different than a traditional savings account. So, opening a high-yield savings account is safe and worth considering.
Can you withdraw money from a high-yield savings account?
You can withdraw funds from a high-yield savings account like you can a traditional savings account.
How often can I take money out of a high-yield savings account?
It used to be a rule that you could only withdraw or transfer cash out of a high-yield savings account up to six times per month without paying any fees. Since the pandemic, however, this rule has ended and it is now up to each bank's discretion to choose how often savers can withdraw. Most banks have stuck to this six-times-per-month rule, while others let you make unlimited withdrawals at no cost.
Do you pay taxes on a high-yield savings account?
Interest accrued on a high-yield savings account is taxed as ordinary income. You must report the interest on your tax return for any account that earned more than $10 in one year.
What does APY mean?
APY is the acronym for "annual percentage yield" and it represents the total amount of interest a bank account earns over one year, taking into account compound interest. APY is different from an account's actual interest rate, the latter meaning simply the percentage of interest you'd earn on a bank account.
Why trust CNBC Select?
At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed decisions with their money. Every high-yield savings account review is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of banking products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics. See our methodology for more information on how we choose the best high-yield savings accounts.
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Our methodology
To determine which high-yield savings accounts offer the best return on your money, CNBC Select compared dozens of U.S. savings accounts offered by various financial institutions, including brick-and-mortar banks, online banks and large credit unions. Though most online banks don't have physical branches, they often offer higher APYs, lower fees and overall better benefits than national brick-and-mortar banks.
We narrowed down our ranking by only considering those savings accounts that offer an above-average interest rate, no monthly maintenance fees and low (or no) minimum balance requirements.
While the accounts we chose in this article consistently rank as having some of the highest APY rates, we also compared each savings account on a range of features, including ease of use and account accessibility, as well as factors such as insurance policies and customer reviews when available. We also considered users' deposit options and each account's compound frequency.
All accounts included on this list are FDIC- or NCUA-insured up to $250,000. Note that the rates and fee structures for high-yield savings accounts are not guaranteed forever; they are subject to change without notice and they often fluctuate per the Federal Reserve rate. Your earnings depend on any associated fees and the balance you have in your high-yield savings account. To open an account, most banks and institutions require a deposit of new money, meaning you can't transfer the money you already had in an account at that bank.
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Information about the Synchrony Bank High Yield Savings Account has been collected independently by CNBC Select and has not been reviewed or provided by the bank prior to publication.
*SoFi members with direct deposit can earn up to 4.60% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. There is no minimum direct deposit amount required to qualify for the 4.60% APY for savings. Members without direct deposit will earn up to 1.20% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Interest rates are variable and subject to change at any time. These rates are current as of 12/12/23. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet.