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  • Banks and credit unions offer different interest rates on savings accounts.
  • Online banks and credit unions tend to offer the most competitive interest rates.
  • Interest rates fluctuate for both traditional and high-yield savings accounts.
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The type of savings account you have has a big impact on your interest rate, and switching your savings from a traditional savings account to a high-yield savings account could help your money grow much quicker.

Here’s what you should know about savings interest rates.

Traditional savings account interest rates

The average savings account in the US has an interest rate of 0.17% APY, according to data from the FDIC.

Many banks offer savings accounts, but these traditional savings accounts earn fairly low interest rates.

Today’s savings account rates

Here are some of the savings account interest rates offered on all balance tiers for the most basic accounts at major banks:

With these low interest rates, it’s hard to make money grow, whether its 0.01% APY or 0.05% APY. But, you don’t have to settle for such low interest rates

High-yield savings account interest rates

A high-yield savings account could help you grow your money quicker and make your money work harder, without any cost or inconvenience to you. The following are all high-yield savings accounts:

Earning more interest is as easy as opening a different savings account. Move your savings from a traditional account to a high-yield savings account and you’ll start earning more. High-yield savings accounts earn multiple times more than a traditional savings account.

We’re not talking investment returns, here — more like 1.80% APY to 3.01% APY. That’s along the lines of the rates you’d see with some CDs, but with the flexibility to access your money when you need it. And, it’s still significantly higher than the 0.17% APY average.

Most high-yield savings accounts are available through online-only banks. Though they’re newer, you may already be familiar with several of the online banking services that offer these accounts, including Ally, Bask Bank, and Marcus by Goldman Sachs.

Online banks don’t have the overhead that brick-and-mortar banks do, allowing them to pass on more money in interest. Based on the account interest rates above, it’s easy to tell just how wide the gap is between the interest offered by a traditional savings account and an online, high-yield savings account.

Savings account interest rates by balance

Overall, there’s no difference between average interest rates for a balance under $100,000 and a balance over $100,000 — both have an average of 0.17% APY, according to FDIC data

There are a few banks that reward customers with a larger balance. But, there are quite a few that offer the same interest rates no matter the balance. 

The balance you keep in your savings account could sway your interest rate. But at many banks, it won’t make much difference. The bank you choose makes more of an impact than the amount you keep.

Savings account interest rates change often

It’s worth noting that interest rates change often for both traditional and high-yield savings accounts. Banks move interest rates in step with the federal funds rate — the amount the Federal Reserve charges banks to borrow money. When the federal funds rate goes down, interest rates do as well, and vice versa.

As the Fed has raised interest rates in the first half of 2022, savings interest rates have slowly been going up, too. Even if they were to drop, however, it’s best practice to keep saving. That way, when rates inevitably do go back up, you’ll be earning interest on a larger amount of principal.



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