A savings account is a good place to keep money safe and liquid, but it’s not a great place to earn money, right? Not necessarily. Some banks and credit unions offer savings accounts with respectable interest rates that rival the rates earned with CDs—but without the restrictions.
Each week, we survey over 150 banks and credit unions to find the best rates and deals. These high-interest savings accounts are available to customers nationwide, and your funds are federally insured up to $250,000 per depositor per institution. We start by finding the highest rates, and we favor accounts with low minimum deposit requirements and friendly fee structures.
We also include money market accounts if they function like savings accounts. That means if an account pays a high yield and doesn’t allow you to write checks, it’s in the mix.
We teamed up with QuinStreet to bring you the savings account offers in the following table. Below that, you'll find our editors' picks for the best high-interest savings accounts and rates as of April 2, 2020. All of the banks and credit unions listed are insured by the FDIC or NCUA.
Each month, we evaluate savings accounts that are widely available throughout the U.S. to identify the best high-interest savings accounts. For this round-up, we primarily look at the annual percentage yield (APY) offered, but to help you compare options, we also consider factors like how quickly interest compounds, how easily you can make deposits, and customer service availability.
APYs are changing rapidly amid widespread uncertainty about the economy and financial markets. The Balance is monitoring rates and updating them accordingly.
Best High-Yield Savings Accounts for April 2020
- Prime Alliance Bank 1.96% APY: $1 to open and $10,000 to earn stated APY.
- Fitness Bank 1.90% APY: $100 to open and $100 minimum to avoid a $10 monthly account fee. Must average 12,500 steps daily to earn the top rate.
- CFG Bank 1.90% APY: $1,000 to open and $25,000 to earn stated APY.
- Prime Alliance Bank 1.86% APY: $1 to open and to earn stated APY.
- CFG Bank 1.80% APY: $1,000 to open to earn stated APY.
- Live Oak Bank 1.75% APY: $0 to open to earn stated APY.
- Vio Bank 1.75% APY: $100 to open and $0 to earn stated APY.
- First Foundation Bank 1.75% APY: $1,000 to open and to earn stated APY.
- ConnectOne Bank 1.75% APY: $2,500 to open and to earn stated APY.
- CIT Bank 1.75% APY: $100 to open and $25,000 or $100 monthly deposit to earn stated APY.
Here's more information about the banks offering the best savings account rates right now:
Prime Alliance Bank, founded in 2004, pays its best APY on balances of $10,000 or more. There are no monthly fees or minimum deposit requirements. However, if your balance falls below $10,000, you’ll earn a bit less. Interest is compounded daily and paid quarterly. If you need additional banking services, Prime Alliance has free checking, CDs, and more.
Still a decent rate if your account drops below $10,000
60-day hold on all new accounts
FitnessBank is an online division of Newton Federal Bank that rewards you based on your fitness activity. Earn the max APY if you log at least 12,500 steps daily with your Fitbit, Apple Health, Garmin, or Google Play fitness tracker. Lower rates are available with lower activity levels, and you must open the FitnessBank app at least monthly to log your steps. The account requires a minimum of $100 to open, and you must maintain at least that much as an average daily balance to avoid a $10 monthly maintenance charge. Interest compounds daily and is credited monthly.
Competitive earnings even if you don't hit 12,500 steps daily
No mobile deposit
CFG Bank, founded in 1927, pays its best APY in the Online CFG High Yield Money Market Account. The website is not as functional or informative as some of the largest online banks, but if you prioritize high rates over the user experience, CFG might deliver what you need. The account requires $1,000 to open and avoid monthly fees, but you’ll earn a smaller APY at that level. For the highest rate, you must maintain a minimum daily balance of at least $25,000. Interest compounds daily and is credited monthly.
Competitive CD rates complement the savings account
Website has limited information and features
Live Oak Bank dates back to 2008, when the bank formed to provide loans to veterinary practices. The Online Savings account has no minimum or ongoing balance requirements to earn the APY. That makes it easy to qualify for a great rate, and there are no monthly fees, even if you withdraw everything. Live Oak also offers a handy app that can function as your financial dashboard, allowing you to view accounts at other banks. Interest compounds daily and posts to your account monthly.
No minimum balance required
Business savings with no monthly fees
No checking or money market accounts
Vio Bank is the online division of MidFirst Bank. The High Yield Online Savings account requires $100 to open. There are no monthly fees if you use online statements, and customer service is available into the evening hours (as late as 9 p.m. Central on weekdays). If you need to spend your money, your account balance can fall to zero, and you still don’t pay monthly fees. Interest is compounded daily and credited monthly.
Customer service by phone seven days per week
No monthly fees, regardless of balance
No checking accounts available
First Foundation Bank was founded in 1990 and has branches in three states. The online savings account at First Foundation Bank pays its top APY on balances of $1,000 and higher, and there are no monthly fees. To open an account, you must start with $1,000, and you earn a more modest APY if your balance drops below $1,000. The online savings account is for new money only and cannot be funded through an existing First Foundation Bank account.
First Foundation Bank also offers checking accounts and other products, but those are only available in California, Nevada, or Hawaii (the savings account is available nationwide). Interest compounds daily and is credited monthly.
No monthly fees, even if your account balance dwindles
Limited offerings unless you live in select states
ConnectOne Bank began with a focus on serving businesses in 2005. Branches are located in New York and New Jersey, but you can open accounts online, including a high yield online savings account. That account requires $2,500 to open, and you need to keep at least that much in your account to earn the advertised rate. There’s no monthly fee, and you can find a broad variety of other services at ConnectOne. Interest in the savings account compounds daily and is credited monthly.
No monthly fees
Comparable rates available elsewhere with smaller balances allowed
CIT Bank was founded in 1908, and started out providing financing to businesses in St. Louis, Missouri. The bank rewards you for adding to your savings, paying its best APY to customers who deposit $100 per month to this savings account. You can also earn the highest rate by depositing at least $25,000. There are no monthly fees, and you can open this account with as little as $100. In addition to this savings account, CIT Bank has CDs, interest checking, and money market accounts. Interest in your Savings Builder account compounds daily and is credited monthly.
Encourages saving behavior
Competitive No-Penalty CD available
Earn the same or more at other banks with fewer requirements
What Is a High-Interest Savings Account?
A high-interest savings account, also known as a high-yield savings account, helps you grow your money while keeping it accessible. Savings accounts often pay interest on your deposits, but interest rates vary from bank to bank. What makes high-interest accounts unique is a relatively high rate on your balance: They may pay several times more than the national average, which multiplies your earnings.
As you earn interest on your savings, you can leave the money in your account and allow the funds to compound. Put another way, you earn interest on the interest payments you received in previous months. The higher your rate, the faster your money grows.
What Should You Look for in a High-Yield Savings Account?
The interest rate is the feature that most people pay attention to when shopping for a high-yield savings account. Compare banks and pick a competitive rate, but don’t ignore other critical features.
- Low fees are crucial. If you’re paying monthly maintenance fees, you might wipe out any earnings in your account (or even see your account balance fall each month).
- Verify that your money will be safe. Banks should be FDIC-insured, and the safest credit unions provide NCUSIF coverage.
- Select a bank that will be convenient to work with. Evaluate how you’ll use the account, and find a bank that fits your needs. For example, if you want to deposit checks frequently, make sure the bank offers mobile deposit. If you withdraw cash regularly, choose a bank with a convenient ATM network or ATM rebates.
Why Do Savings Account Rates Change?
The interest rate on your savings account changes over time. In some cases, the rate remains the same over extended periods. But when rates in the broad economy change, banks typically move in sync with those changes. If the Fed cuts rates, there’s a good chance that your savings account rates will remain stagnant or fall. When rates rise, banks tend to increase rates, but not necessarily as quickly as you’d like.
CDs enable you to lock in a rate that doesn’t change, but there are pros and cons of using CDs.
Why Are Some Bank Interest Rates Higher Than Others?
How much interest you earn can vary quite a bit. According to the Federal Deposit Insurance Corporation (FDIC), the average annual percentage yield (APY) across all savings accounts is just 0.09%. While interest rates tend to be low at the biggest brick and mortar banks, some banks (including many online ones) offer rates around 2%.
Banks raise rates when they want to gather money. If they need to get deposits in the door, a high rate on savings accounts attracts customers. If, on the other hand, they don’t need cash, they can keep rates lower.
Banks have different approaches to earning money. Some take deposits and lend them out, while others take a more varied approach (earning revenue and fees from other services like credit cards and ancillary business).
Organizational structure is also important. Some banks have shareholders demanding that the bank grow (and/or share income with the shareholders), and those demands may make it harder to pay high rates to depositors. However, some banks are able to keep only what they need to pay the bills and share the rest of the revenue (from loans, ATM fees, etc.) with account holders. Small banks and credit unions are most likely to fit the latter model.
Is Savings Account Interest Taxable?
Interest you earn in your savings account is generally taxable as income. Your bank typically reports your earnings on Form 1099-INT, and you should provide that information to your tax preparer or include it with your tax filings.
Keep an eye out for a 1099-INT in the mail during tax season. You may also be able to download the form through your online banking portal.
With individual accounts, joint accounts, and other taxable accounts, you’ll pay tax on the interest you receive as income for the year. But if your account is part of a retirement account like an IRA, you may be able to postpone or avoid taxation on that interest.
In many cases, banks do not provide a 1099-INT unless you earn at least $10 during the year.
State of Connecticut Department of Banking. "ABCs of Banking." Accessed March 12, 2020.
Federal Deposit Insurance Corporation (FDIC). "Weekly National Rates and Rate Caps - Weekly Update." Accessed March 12, 2020.
Board of Governors of the Federal Reserve. "Changes in Monetary Policy and Banks' Net Interest Margins: A Comparison across Four Tightening Episodes." Accessed March 12, 2020.
National Credit Union Administration. "What Is a Credit Union?" Accessed March 12, 2020.
Internal Revenue Service. "Topic No. 403 Interest Received." Accessed March 12, 2020.
Internal Revenue Service. "Instructions for Forms 1099-INT and 1099-OID (2020)," Accessed March 12, 2020.