Where to find savings accounts paying 4% to 5% APY right now
High-yield savings accounts exist at online banks, some credit unions, and a handful of traditional banks with strong online presences. The banks paying the highest rates—currently between 4% and 5% APY—are almost always online-only operations like Marcus, Ally, American Express Personal Savings, and Discover Bank. A few credit unions and regional banks match or come close to these rates, but you have to search actively because they do not advertise as widely.
The reason online banks pay more is simple: they have no physical branches to maintain, so they pass the savings to depositors through higher rates. A traditional bank with a branch on your street typically pays 0.01% to 0.5% APY on savings, even if it has an online division. The trade-off is that you cannot walk into a location to deposit cash or speak to someone in person—everything happens by mail, mobile app, or wire transfer.
Rates change weekly, sometimes daily, so the specific number you see today will not be the number you see in three months. What matters is knowing which institutions historically compete for deposits and where to check when you are ready to move money.
Key Takeaways
- Online banks consistently offer the highest yields because they operate without physical branches and pass those savings to account holders.
- Credit unions sometimes match online bank rates, especially if you are a member of a large institution or a credit union network, but you have to ask directly because rates are not always published online.
- Traditional banks with physical locations rarely pay more than 0.5% APY on savings, even if they have online accounts.
- Rates move frequently—check the current rate before you open an account, because the rate you see today may not be the rate you lock in tomorrow.
- All deposits at FDIC-insured banks and NCUA-insured credit unions are protected up to $250,000 per account holder, regardless of the rate paid.
Online banks paying the highest rates
Marcus by Goldman Sachs, Ally Bank, American Express Personal Savings, and Discover Bank have historically been the first to raise rates when the Federal Reserve increases its benchmark rate, and the last to cut when rates fall. Each of these institutions is FDIC-insured and has no monthly fees on savings accounts. You can open an account online in minutes and begin transferring money the same day, though external transfers typically take one to three business days to clear.
Rates at these banks shift in response to Federal Reserve decisions and competitive pressure. When the Fed raised rates aggressively in 2022 and 2023, these banks moved quickly to 4.5% to 5.35% APY. As the Fed began holding rates steady in 2024, some of these banks cut their rates to 4.25% to 4.5%, while others held firm. The specific rate you see depends on when you check and which bank you are comparing.
Opening an account at any of these banks requires a Social Security number, proof of identity, and an initial deposit—usually $0 to $25. You can fund the account by linking a checking account at another bank and transferring money electronically, or by mailing a check. Most people transfer money from their existing bank account within a day or two of opening.
Credit unions and regional banks with competitive rates
Some credit unions pay rates equal to or better than online banks, but the information is harder to find because credit unions do not have the same marketing budgets. Navy Federal Credit Union, Connexus Credit Union, and Pentagon Federal Credit Union have offered rates between 4.5% and 5.0% APY on savings accounts, though membership requirements vary. Navy Federal is open to active military, veterans, and their families. Connexus and Pentagon Federal have broader membership but may require you to live in certain states or work in certain industries.
A few regional banks—including Vanguard Bank, Axos Bank, and LendingClub Bank—also compete on rates and pay between 4.0% and 4.75% APY. These are FDIC-insured and operate online, so the experience is similar to opening an account at Marcus or Ally. The advantage is that you may find a rate that is slightly higher or a feature that matters to you—for example, some allow you to link multiple savings accounts or set up automatic transfers more easily than others.
The disadvantage is that rates at smaller or regional banks can move faster than rates at the largest online banks. If a regional bank cuts its rate, it may do so with little notice. Check the rate again before you transfer a large sum, and read the account terms to see whether the bank reserves the right to change rates without notice.
How to compare rates across banks
The most reliable way to compare is to visit each bank's website directly and look for the savings account rate listed on the product page. Avoid relying on rate-comparison websites alone, because they update slowly and sometimes show outdated information. Write down the rate, the APY, and the date you checked it. Then check again a week later to see whether the rate has moved.
When you compare, look for these details: whether the rate applies to all balances or only balances above a certain threshold, whether there is a promotional rate that expires after a few months, and whether the bank charges monthly fees. Most high-yield savings accounts have no monthly fee, but some banks charge a fee if your balance falls below a minimum—usually $0 to $100. A $10 monthly fee erases most of the benefit of a 4.5% rate on a $5,000 balance.
Also check whether the bank allows you to make unlimited transfers out of the savings account. Federal rules no longer limit the number of transfers, but some banks still impose their own limits—for example, allowing only six transfers per month. If you plan to move money frequently, this matters.
What happens to your rate when the Federal Reserve changes policy
When the Federal Reserve raises its benchmark interest rate, banks typically raise the rates they pay on savings accounts within days or weeks. When the Fed cuts rates, banks cut savings rates more slowly—sometimes waiting weeks or months. This is because banks profit from the difference between what they pay depositors and what they charge borrowers. When rates fall, banks want to keep that gap as wide as possible.
If you lock in a high rate at 4.75% APY and the Fed begins cutting rates, your rate will eventually fall too. There is no way to lock in a rate permanently at most banks. Some banks offer promotional rates that are may provide for a set period—for example, 5.0% APY for six months—but after that period ends, your rate drops to the standard rate. Read the account terms before you open to see whether a promotional rate applies and when it expires.
The practical takeaway: open a high-yield savings account when rates are high, but do not expect the rate to stay the same forever. If rates fall and you have a large balance, you may want to move your money to a bank that is still paying a higher rate. This is free to do—you can transfer money between banks without penalty.
FDIC insurance and account safety
All of the banks mentioned here are FDIC-insured, which means your deposits are protected up to $250,000 per account holder per bank. If a bank fails, the FDIC pays you back in full up to that limit. This protection applies regardless of the rate the bank pays—a 5% account is just as safe as a 0.01% account at an FDIC-insured bank.
If you have more than $250,000 to deposit, you can split it across multiple banks to stay within the insurance limit at each one. For example, you could put $250,000 at Marcus and $250,000 at Ally, and both amounts would be fully insured. You can also open multiple accounts at the same bank—for example, a savings account and a money market account—and each account is insured separately up to $250,000.
Credit unions are insured by the NCUA (National Credit Union Administration) under the same $250,000 limit. The protection works the same way: if a credit union fails, the NCUA reimburses you up to $250,000.
Moving money between banks without losing interest
When you transfer money from one bank to another, the transfer itself takes one to three business days. During that time, your money is in transit and earning no interest. This is not a major concern for most people, but if you are moving a large sum and rates are changing rapidly, you may want to time the transfer carefully.
The safest approach is to open the new account first, then initiate the transfer from your old bank. Most banks allow you to link an external account and pull money from it, or you can have your old bank push the money to your new bank. Both methods are free and do not require you to write a check or visit a branch. The transfer typically clears within one to three business days, and interest begins accruing at the new bank as soon as the money arrives.
If you are moving money because rates have fallen at your current bank, check the rate at the new bank one more time before you initiate the transfer. Rates can move daily, and you want to confirm that the new bank is still paying what you saw when you decided to switch.
Frequently Asked Questions
Can I get a higher rate if I keep a larger balance?
Most high-yield savings accounts pay the same rate on all balances, no matter how much you deposit. A few banks offer tiered rates—for example, 4.5% on balances up to $100,000 and 4.75% on balances above that—but this is uncommon. Check the account terms before you open to see whether the bank uses tiered rates.
What if a bank cuts its rate after I open an account?
Banks can change rates at any time without your permission. You will usually receive notice by email or mail, but you are not required to stay with the bank if you disagree with the new rate. You can transfer your money to another bank for free. There is no penalty for closing a savings account.
Do I have to pay taxes on the interest I earn?
Yes. Interest earned on savings accounts is taxable income. Banks send you a 1099-INT form at the end of the year showing how much interest you earned, and you report that amount on your tax return. The bank does not withhold taxes automatically, so you may owe taxes when you file.
Is my money safe if I keep it in an online bank?
Yes, as long as the bank is FDIC-insured. Your deposits are protected up to $250,000 per account holder, the same as at a traditional bank with physical branches. You cannot walk into a location to withdraw cash, but you can transfer money to another bank or request a check by mail.
How often do rates change at these banks?
Rates can change weekly or even daily, depending on market conditions and Federal Reserve policy. Most banks announce rate changes on their website and send email notifications to account holders. Check the rate at your bank once a week if you are considering moving money, or once a month if you are satisfied with your current rate.