Where to find high-yield savings accounts right now

High-yield savings accounts are offered by online banks, some traditional banks with online divisions, and credit unions. The banks paying the highest rates today are mostly online-only: Marcus by Goldman Sachs, American Express Personal Savings, Ally Bank, and Discover Bank typically lead. Traditional banks like Chase, Bank of America, and Wells Fargo offer savings accounts, but their rates are usually much lower—often under 0.01% APY. Credit unions vary widely; some pay competitive rates through programs like CO-OP Network or Alliant Credit Union, while others pay almost nothing.

The rate you see advertised changes weekly or even daily, so the "best" account today may not be the best next month. What matters more is understanding which institutions actually compete on rate and which ones don't. Online banks compete because they have lower overhead; traditional brick-and-mortar banks don't need to, because most customers stay put regardless of rate.

Key Takeaways

  • Online banks and credit unions typically offer rates 10 to 20 times higher than traditional banks, though the exact rate changes frequently.
  • You can open an account at most online banks in 10 to 15 minutes with a Social Security number, driver's license, and initial deposit (often $0 to $25).
  • Your deposits are insured up to $250,000 per account holder at FDIC-insured banks and up to $250,000 at NCUA-insured credit unions, so moving money to a higher-rate account does not increase your risk.
  • Rates are not locked in; the bank can lower your rate at any time, though they must notify you in advance and you can move your money elsewhere.
  • Some online banks charge no monthly fee and have no minimum balance requirement, while others impose small fees or require $25,000 or more to earn the advertised rate.

Online banks that compete on rate

Marcus by Goldman Sachs, American Express Personal Savings, Ally Bank, and Discover Bank have consistently offered rates in the top tier. As of late 2024, these institutions typically pay between 4.0% and 4.5% APY, though this changes. You can check their current rates on their websites; they update daily.

Opening an account takes 10 to 15 minutes. You will need your Social Security number, a government-issued ID, and proof of address (a recent utility bill or bank statement works). Most online banks allow you to fund the account by transferring money from another bank account; the transfer usually clears in one to three business days. Some require an initial deposit of $0 to $25, while others have no minimum.

These banks are FDIC-insured, meaning your deposits up to $250,000 are protected if the bank fails. You can hold multiple accounts at different banks and each one is insured separately, so moving $100,000 from a 0.01% account to a 4.25% account does not put your money at risk—it only changes how much interest you earn.

Traditional banks with online savings options

Chase, Bank of America, Wells Fargo, and Citibank all offer savings accounts online. Their current rates are typically 0.01% to 0.05% APY—roughly 80 to 100 times lower than online banks. If you already bank with one of these institutions and value the convenience of a single relationship, the rate difference may not matter for small balances. For $10,000, the difference between 0.01% and 4.25% is about $420 per year.

These banks do not compete on rate because most customers do not shop around. They rely on inertia: you have a checking account there, your paycheck deposits there, and switching feels like work. The banks know this and price accordingly.

If you keep money at a traditional bank for checking and bill pay, it makes sense to move your savings to a high-yield account elsewhere. You can keep a small emergency fund ($500 to $1,000) in your checking account for immediate access and move the rest to a higher-rate savings account at an online bank. Transfers between banks take one to three business days, so this is not a solution if you need the money today, but for money you plan to hold for weeks or months, the rate difference is substantial.

Credit unions and their rate structures

Credit unions are member-owned nonprofits, and some offer competitive savings rates. Alliant Credit Union, for example, has historically paid rates comparable to online banks. Others pay very little. The variation is large because credit unions are not centrally managed; each one sets its own rates based on its own costs and strategy.

To join a credit union, you must meet a membership requirement—often living or working in a specific county, working for a specific employer, or being related to a current member. Some credit unions have opened membership to anyone, while others remain restricted. Membership is usually free or costs $1 to $5 one-time.

Credit union deposits are insured by the NCUA (National Credit Union Administration) up to $250,000 per account holder, the same as FDIC insurance. If you already belong to a credit union, call and ask what rate they currently pay on savings. If it is below 2%, you will earn significantly more at an online bank.

What to check before opening an account

Before moving money, compare three things: the current APY, any monthly fees, and the minimum balance required to earn that rate. A bank advertising 4.5% APY might only pay that rate if you maintain a $25,000 balance; below that, you might earn 3.5%. Read the fine print on the bank's website or call and ask directly.

Monthly fees are rare at online banks but do exist at some. A $5 monthly fee on a $10,000 balance earning 4.25% APY costs you about $60 per year—offsetting roughly one-seventh of your interest. Avoid accounts with monthly fees unless the rate is significantly higher.

Check whether the bank allows you to link external accounts for transfers. Most online banks do, but a few require you to fund the account by check or wire transfer, which is slower and more cumbersome. Also confirm the bank is FDIC-insured by searching the FDIC's BankFind tool on fdic.gov; if it is not listed, your deposits are not protected.

How rates change and what happens to your money

Banks can lower your rate at any time, though federal law requires them to notify you in advance—usually 30 days. When rates fall across the industry (which happens when the Federal Reserve cuts rates), most banks lower their savings rates within weeks. When rates rise, banks are slower to raise savings rates because they want to keep more of the profit.

If your bank lowers your rate and you do not like it, you can move your money to another bank. The transfer takes one to three business days. Your interest continues to accrue at the old rate until the money leaves the account, so you do not lose anything by waiting a few days to move it.

You can also hold accounts at multiple banks to hedge against rate changes. For example, you might keep $50,000 at Marcus and $50,000 at Ally. If one bank cuts its rate, you still earn the higher rate on half your money while you decide whether to move it.

Frequently Asked Questions

Can I move money between banks without losing interest?

Yes. Your interest accrues daily based on the balance in the account. When you transfer money out, you earn interest up to the day it leaves. The receiving bank begins earning interest the day the money arrives. There is no gap or penalty.

What if I need the money before the transfer clears?

Transfers between banks take one to three business days. If you need money today, you cannot use a high-yield savings account at a different bank. Keep a small emergency fund ($500 to $1,000) in your checking account for immediate access, and move the rest to savings.

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

Yes. Interest earned in a savings account is taxable income. The 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. High-yield accounts earn more interest, so you will owe more tax—but you still come out ahead because the interest exceeds the tax.

Is my money safer at an online bank than a traditional bank?

No. Both are equally safe if they are FDIC-insured. Your deposits are protected up to $250,000 whether the bank has a physical branch or not. Check the FDIC's BankFind tool to confirm the bank is insured.

What happens if I close the account before a certain time period?

High-yield savings accounts have no early withdrawal penalty. You can close the account and move your money anytime without losing interest or paying a fee. This is different from certificates of deposit (CDs), which do charge a penalty for early withdrawal.