Currently, the national average interest rate on savings account balances in the United States is far from keeping pace with inflation. The good news is that you can do better with a high-yield savings account.
We have reviewed the best high-yield savings accounts in the market, discussing their rates, fees, and account benefits.
Best High-Yield Savings Accounts and Rates in October 2023
We evaluated dozens of online banks, traditional banks, and credit unions to find the best high-yield savings accounts currently available.
All of these accounts offer interest rates several times the national savings account average. They can help you build an emergency savings fund faster and combat inflation.
All accounts are FDIC-insured, with the current limit being $250,000 per account.
American Express® High-Yield Savings Account
UFB High-Yield Savings Account
Discover Bank Online Savings
Barclays Online Savings
Bask Bank Interest Savings Account
CIT Bank Platinum Savings
Popular Direct Select Savings Account
Milli Mobile Savings Account
Varo High-Yield Savings
Marcus Online Savings Account
LendingClub Bank High-Yield Savings
American Express® High-Yield Savings Account
Savings Rate: 4.30% Annual Percentage Yield (APY) (as of October 10, 2023)
Minimum Balance: $0
Monthly Fee: $0
Our Rating: 4.3/5
The American Express® High-Yield Savings Account (FDIC member) offers above-average savings returns (currently 4.30%) and multiple high-yield CDs, but its real highlight is its ease of use and 24/7 customer service.
For those seeking account assistance anytime and anywhere, the American Express® High-Yield Savings is the top choice for a high-yield savings account.
It provides 24/7 live customer support via phone and robust self-service portal to address common issues that arise in typical online banking relationships.
In addition to the savings account, American Express offers several high-yield CDs. It is also one of the few online banks that does not charge a fee for paper statements.
Editor’s Note: Any opinions, analyses, reviews, or recommendations expressed in this article are those of the author’s alone and have not been reviewed, approved, or otherwise endorsed by any savings product issuer.
UFB High-Yield Savings Account
Savings Rate: 5.25% APY
Minimum Balance: $0
Monthly Fee: $0
Our Rating: 3.8/5
UFB’s High-Yield Savings Account offers all balances an attractive 5.25% annual interest rate with no strings attached.
UFB Direct, a division of Axos Bank, offers the nation’s best savings rates.
The UFB High-Yield Savings has no minimum balance requirement or minimum deposit requirement, and you don’t have to pay a monthly maintenance fee.
Unlike some competitors, UFB’s savings account comes with ATM access and a free ATM card.
If you’re looking to diversify and want an account with check-writing capabilities, the online bank also offers a competitive high-yield money market account.
Discover Bank Online Savings
Savings Rate: 4.30% APY
Minimum Balance: $0
Monthly Fee: $0
Our Rating: 4.3/5
Discover Bank’s Online Savings Account offers an impressive 4.30% APY on all balances. It also has one of the best new account promotions among all US savings accounts, with eligible deposits of up to $200.
Discover Bank’s Online Savings Account offers an interest rate above the national average (currently 4.30%) and has no monthly maintenance fees or minimum balance requirements.
The account doesn’t charge for excessive withdrawals, expedited official bank check delivery, stop payment orders, or insufficient funds.
But the account’s real standout feature is the opportunity to earn up to $200 in income when you open a new account.
By opening your first Discover savings account before December 14, 2023, and depositing at least $15,000 within 30 days of account opening, you can earn $150 as a welcome bonus, or
By opening your first Discover savings account before December 14, 2023, and depositing at least $25,000 within 30 days of account opening, you can earn $200 as a welcome bonus.
This offer is available nationwide. See advertiser website for complete details.
What is a high-yield savings account? A high-yield savings account offers a higher interest rate compared to traditional savings accounts.
These accounts are typically offered by online banks or credit unions, providing individuals with the opportunity to grow their savings more quickly.
Competitive rates are the main feature that distinguishes high-yield savings accounts from regular savings accounts.
With a high-yield savings account, you can earn more money from your savings over time, allowing your funds to grow at a faster rate. This can be particularly useful if you are saving for specific financial goals, such as a home down payment or an emergency fund.
However, it is important to note that high-yield savings accounts may come with limitations compared to traditional savings accounts, such as minimum balance requirements or withdrawal limits.
Researching and comparing different high-yield savings account options is crucial to finding an account that best suits your needs and financial goals. If you do this, a high-yield savings account can be a useful tool to help you save more effectively and achieve your financial objectives.
Advantages and Disadvantages of High-Yield Savings Accounts Before opening an account, it is important to understand the advantages and disadvantages of a HYSA.
Advantages Higher Rates: High-yield savings accounts offer higher rates than traditional savings accounts, allowing your funds to grow faster. Security: These accounts are typically supported by FDIC-insured banks, meaning your deposits are protected. Ease of Access: They also allow you to access your funds quickly and easily. This means you can withdraw funds at any time without penalties or restrictions. Low Minimum Balances: Many high-yield savings accounts have low minimum balance requirements, making them accessible to a wide range of savers. You don’t need a large amount of money to open an account and start earning interest. Compound Interest: The interest earned on high-yield savings accounts is typically compounded, allowing you to earn interest on your initial deposit and accumulated interest. Disadvantages Lower Liquidity: While high-yield savings accounts provide easy access to your funds, certain accounts may have a maximum number of monthly withdrawals or charge fees for excessive withdrawals. Inflation Risk: Although the interest rates on high-yield savings accounts are higher than those of regular savings accounts, they may not keep up with inflation. Over time, the purchasing power of your savings may decrease. Opportunity Cost: While HYSA is a secure option, they may not offer the highest possible returns. Other investment options such as stocks or real estate may offer higher long-term returns if you are willing to take on more risk. Limited Services: High-yield savings accounts may offer fewer services compared to full-service bank accounts. These accounts may not have features such as check-writing or ATM cards, limiting the ways you can access your funds.
Alternative Options to High-Yield Savings Accounts HYSA is not the only way for savers to accelerate their financial goals. When comparing account options, check whether your bank offers any of the following account types:
Certificates of Deposit (CDs): CDs are time deposits offered by banks and credit unions. They typically offer higher rates than regular savings accounts but restrict your ability to withdraw funds before the maturity date. Money Market Accounts (MMAs): Money market accounts are similar to savings accounts but usually offer higher annual rates. The check-writing ability of MMAs is often limited, and they require higher minimum balances. Government Bonds: Investing in government bonds, such as treasury bonds, can provide stable and predictable returns. These bonds are considered low-risk investments and are backed by the government. Corporate Bonds: Corporate bonds are debt securities issued by companies. They typically offer higher rates than government bonds but come with higher risks. How to Choose a High-Yield Savings Account Several key factors need to be considered when choosing a high-yield savings account.
To help you make the most informed decision, here is a detailed list of what to look for:
Interest: Look for accounts with high-interest rates. By choosing an account with the highest rates, you will be able to grow your account faster. Rates can fluctuate, so it’s crucial to check before opening an account. APY: Annual Percentage Yield (APY) tells you how much compound interest you will earn within a year. Choose an account with a higher annual rate for maximum returns. The best high-yield savings account rates are significantly higher than traditional rates. Minimum Deposit Requirement: Some accounts require a minimum deposit amount to earn the advertised rate. Make sure it aligns with your savings goals and that you can easily maintain it. Fees: Check for monthly service fees, transaction fees, and ATM fees. Avoid accounts with excessively high fees as they can eat into your savings. Accessibility: Consider how easy it is for you to access your funds. Online banks and mobile apps can make managing your savings convenient, while some accounts may offer features like ATM cards or checks. FDIC Insurance: Ensure that your savings account is backed by the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA). This protection guarantees coverage for each depositor, for each insured bank or credit union, for up to $250,000. Customer Service: Look for banks with good customer service. Read reviews and seek recommendations to choose a bank that has a positive relationship with its customers. Account Features: Some accounts come with additional perks and features, such as automatic transfers, goal-setting tools, or budgeting applications. Consider what is most important to you. Bank Reputation: Research the reputation and stability of the bank that offers the account. Look for mature financial institutions with a reliable track record. Account Accessibility: If you prefer to conduct banking in person, consider whether the bank has physical branches or an ATM network in your area. You should also compare the features of mobile banking apps and online banking. By keeping these factors in mind, you can find a high-yield savings account that suits your needs and helps you grow your savings effectively.
How to Open a High-Yield Savings Account Do Your Research: Start by researching different financial institutions that offer high-yield savings accounts with high rates and a good reputation. Check Account Requirements: Look for any minimum balance requirements or monthly fees associated with the savings account. Choose an account that aligns with your financial goals without incurring unnecessary charges. Gather Necessary Documents: Prepare the required identification documents, such as a valid ID, social security number, and proof of address. These documents are typically required when opening an account. Apply Online: Follow the steps on the bank’s website to open the account. The application process usually takes just a few minutes. Fund Your Account: Determine the initial deposit amount required by the bank and transfer funds from your existing bank account. This can typically be done via wire transfer, ACH transfer, or mailing a check. Review Account Terms: Read and understand the terms and conditions of your high-yield savings account. Take note of any withdrawal limits, penalties, or maturity dates.
Methodology Here’s how we select the best high-yield savings accounts:
Our editorial team evaluates high-yield savings accounts based on several key metrics that may determine your experience as an account holder.
For each metric, we choose the account that exceeds all other competitors – giving you the confidence to choose the product that best suits you.
High Yield (High APY): “What’s the rate?” This might be the first question you ask yourself when evaluating a savings account. A higher rate or yield means your funds grow faster. When inflation heats up, the yield is your best defense against the erosion of purchasing power.