Looking for ways to grow your money? We’ve analyzed the top options to help you earn more. Our picks feature competitive rates, low fees, and strong customer service—all backed by FDIC insurance for peace of mind1.
Axos Bank leads with a standout 4.66% APY and no minimum balance requirement, making it ideal for beginners1. BrioDirect offers a solid 4.50% APY, though it requires a $5,000 deposit1. Bread Savings balances accessibility with a 4.40% APY and just $100 to start1.
Not all options are available everywhere. Openbank, for example, excludes residents in eight states1. Always verify rates and restrictions before opening an account.
Key Takeaways
- Axos Bank offers the highest APY (4.66%) with no minimum deposit1.
- BrioDirect requires $5,000 but provides a competitive 4.50% APY1.
- Bread Savings is accessible with a $100 minimum and 4.40% APY1.
- FDIC insurance protects deposits up to $250,000 per account2.
- Check regional availability—some banks exclude certain states1.
What Is a High-Yield Savings Account?
Not all savings options grow your cash equally. A high-yield savings account (HYSA) is an FDIC-insured account that earns up to 10 times more than the national average of 0.41%3. These accounts combine safety with stronger returns, making them ideal for emergency funds or short-term goals.
How High-Yield Accounts Differ From Traditional Savings
Traditional banks often pay just 0.01%–0.10% interest4. In contrast, HYSAs offer annual percentage yields (APYs) near 4% or higher. For example, $10,000 in a HYSA earns $460 yearly versus $41 in a traditional account4.
Key differences include:
- Compound interest: HYSAs calculate earnings daily or monthly, boosting growth.
- Mobile access: Many online banks provide real-time rate tracking via apps3.
- Requirements: Some HYSAs need no minimum deposit, while others demand $5,000+5.
Why APY Matters for Your Savings
Annual percentage yield reflects your true earnings, including compound interest. A 4.50% APY grows $5,000 to $6,054 in five years—nearly $1,000 more than a traditional account3.
Watch for variable rates. For instance, SoFi drops to 1.00% APY without direct deposits3. The Fed’s rate decisions also impact yields, with cuts likely after 20243.
| Account Type | APY Range | $10,000 Annual Earnings |
|---|---|---|
| High-Yield Savings | 4.00%–4.66% | $400–$466 |
| Traditional Savings | 0.01%–0.41% | $1–$41 |
Tip: Always verify APYs aren’t temporary “teaser rates” that drop after a few months.
Best High-Yield Savings Accounts for 2025
We’ve analyzed the top options to help you grow your funds efficiently. These accounts stand out for their competitive rates, accessibility, and unique features. Whether you’re starting small or have a larger deposit, there’s an option for you1.
Axos Bank: No Minimum, High Returns
Axos Bank’s ONE Savings account offers a standout 4.66% APY with no minimum balance requirement1. This makes it ideal for beginners or those who want flexibility. Plus, there are no monthly maintenance fees, so you keep more of your earnings6.
BrioDirect: Competitive Rates With a Steep Minimum
BrioDirect provides a solid 4.50% APY, but it requires a $5,000 minimum deposit1. This account is perfect for those with larger funds who want to maximize their returns. Keep in mind, inactivity for over 21 days can lead to account closure5.
Bread Savings: Accessible and Fee-Free
Bread Savings balances accessibility with a $100 minimum deposit and a 4.40% APY1. There are no monthly fees, making it a great choice for those who want to avoid extra charges. It’s also backed by strong customer service and FDIC insurance6.
Openbank: Strong Rates With Geographic Restrictions
Openbank offers a 4.40% APY but is only available in select states1. It requires a $500 minimum deposit and is not open to existing Santander customers5. If you’re eligible, it’s a solid option with no monthly fees6.
Each of these accounts has its strengths, so choose the one that aligns with your financial goals and deposit size. Always verify rates and restrictions before opening an account.
How We Chose the Top Accounts
Choosing the right place to grow your funds requires careful consideration. We evaluated hundreds of options from banks credit unions to ensure you get the best value. Our process focuses on key factors like annual percentage yields, fees, and mobile features7.
Criteria for Evaluating Financial Products
We used a 12-point system to assess each option. This includes checking for FDIC insurance, analyzing account rates, and reviewing mobile app functionality1. We also considered monthly maintenance fees and minimum balance requirements to ensure affordability5.
As Margarette Burnette notes,
“Selecting an account that meets your overall banking needs is crucial.”
This holistic approach ensures you get more than just a competitive rate1.
Why Fees and Minimum Balances Matter
Even small fees can eat into your earnings. For example, a $5 monthly fee can negate interest gains over time7. We prioritized options with low or no fees and flexible minimum balance requirements5.
Here’s what we looked for:
- FDIC insurance for account safety7.
- No or low monthly maintenance fees5.
- Mobile banking features for convenience1.
- Consistent account rates without teaser offers7.
Our goal is to help you make informed decisions. By focusing on these criteria, we ensure you get a product that aligns with your financial goals1.
Benefits of High-Yield Savings Accounts
Secure your financial future with accounts designed for steady growth. These options combine safety, accessibility, and strong returns, making them a smart choice for anyone looking to grow their funds passively8.
Earning More Interest With Minimal Effort
With competitive annual percentage yields (APYs), your money works harder for you. For example, a $10,000 deposit at a 4.00% APY earns $400 annually—without any active management8.
Unlike the stock market, these accounts offer fixed interest rates that don’t fluctuate, providing stable and predictable returns8. This makes them ideal for emergency funds or short-term financial goals.
Safety and FDIC Insurance
Your deposits are protected by FDIC insurance, covering up to $250,000 per ownership category9. This ensures your money is safe, even if the bank faces financial challenges.
For joint accounts, coverage can extend up to $500,000, offering additional security for families9. Credit unions provide similar protection through NCUA insurance, so you can trust your funds are secure.
Here’s a quick comparison of how these accounts stack up against traditional options:
| Feature | High-Yield Savings | Traditional Savings |
|---|---|---|
| APY Range | 4.00%–4.66% | 0.01%–0.41% |
| FDIC Insurance | Yes | Yes |
| Minimum Deposit | $0–$5,000 | $0–$100 |
Tip: Use the FDIC’s online lookup tool to verify your bank’s insurance status and ensure your funds are fully protected9.
How Much Can You Earn With a High-Yield Account?
Understanding the potential earnings from your funds can help you make smarter financial decisions. Let’s break down the numbers to see how much you can grow your balance over time.
Example: $10,000 at 4% APY
With a 4% annual percentage yield, a $10,000 deposit earns $400 in one year10. This is significantly higher than traditional options, which might only yield $41 annually at a 0.41% rate10.
Here’s how compounding works: If your interest is calculated monthly, your earnings grow even faster. For example, $10,000 at 4% APY with monthly compounding becomes $10,408 after one year10.
Comparing High-Yield vs. Traditional Savings Growth
Let’s look at a side-by-side comparison over different timeframes:
| Timeframe | High-Yield Savings (4% APY) | Traditional Savings (0.41% APY) |
|---|---|---|
| 1 Year | $10,400 | $10,041 |
| 3 Years | $11,249 | $10,124 |
| 5 Years | $12,167 | $10,208 |
As you can see, the difference grows significantly over time10.
Tip: Watch out for fees. A $5 monthly fee can reduce your earnings by $60 annually, which could negate your interest gains10.
Some banks offer tiered interest rates, where higher balances earn better yields. For example, CIT Platinum offers a 4.10% APY but requires a $5,000+ balance to qualify11.
Finally, consider inflation. While high-yield accounts offer better returns, they may not always outpace inflation. Always review your options and adjust your strategy as needed10.
Key Features to Look for in a Savings Account
Finding the right financial tools can make a big difference in your money management. When choosing an account, focus on features that save you money and offer flexibility. Two of the most important factors are avoiding monthly maintenance fees and finding options with low or no minimum balance requirements.
No Monthly Maintenance Fees
Many banks charge monthly maintenance fees, which can eat into your earnings. Fortunately, 72% of high-yield options, like Synchrony Bank, avoid these charges12. Poppy Bank and Newtek Bank also offer accounts with no monthly fees13.
Here are common fees to watch out for:
- Paper statement charges (e.g., BrioDirect charges $5 for paper statements)13.
- Account closure fees.
- Dormant account fees for inactivity.
To avoid these, enroll in online statements and keep your account active. Some banks, like Axos, even waive fees entirely12.
Low or No Minimum Balance Requirements
Some accounts require a high minimum balance, which can be a barrier for many. Synchrony Bank, Poppy Bank, and Jenius Bank all offer accounts with no minimum deposit1213. This makes them accessible to a wider range of users.
If you’re considering an account with a minimum balance requirement, check for waiver options. For example, Fitness Bank requires 12,500 daily steps to qualify for their top rate12.
| Bank | Monthly Fees | Minimum Balance |
|---|---|---|
| Synchrony Bank | None | None |
| Poppy Bank | None | None |
| Newtek Bank | None | None |
Tip: Always review the fine print to ensure you understand all requirements and potential charges. This can help you avoid unexpected fees and keep more of your earnings.
Online Banks vs. Traditional Banks for Savings
Deciding where to keep your money can significantly impact your financial growth. Online and traditional banks each have unique benefits, but understanding their differences can help you make the best choice for your needs.
Why Online Banks Offer Higher Rates
Online banks typically provide higher interest rates on online savings products and charge fewer fees compared to traditional banks14. For example, Bask Bank offers a 4.35% APY, while Barclays provides 3.90%. In contrast, traditional banks like Chase and Wells Fargo offer only 0.10%6.
Lower operational costs allow online banks to pass savings to customers. Many also partner with third-party ATM networks, such as Allpoint or MoneyPass, for cash deposits and withdrawals14.
Trade-Offs Between Convenience and Accessibility
Traditional banks excel in in-person customer service and have extensive physical ATM networks. Online banks, however, rely on phone, chat, or email support, which may not suit everyone14.
Here’s a quick comparison of key features:
| Feature | Online Banks | Traditional Banks |
|---|---|---|
| APY Range | 3.90%–4.35% | 0.10%–0.41% |
| ATM Access | Third-party networks | Physical ATM networks |
| Customer Service | Phone, chat, email | In-person branches |
Tip: Consider a hybrid strategy—keep a traditional bank account for branch services and a high-yield savings account with an online bank for better rates14.
How to Open a High-Yield Savings Account
Getting started with a new financial tool doesn’t have to be complicated. Opening an account is straightforward, and we’ll guide you through the process step by step. Whether you’re new to banking or switching to a better option, these tips will help you get started smoothly.
Step-by-Step Guide to Account Setup
First, choose a bank that meets your needs. Look for competitive rates, low fees, and strong customer support. Once you’ve selected a bank, follow these steps:
- Create an account: Visit the bank’s website or app and start the application process2.
- Provide personal information: Enter details like your name, address, and Social Security Number (SSN)15.
- Verify your identity: Submit a government-issued ID, such as a driver’s license or passport15.
- Submit the application: Review your details and confirm your submission2.
- Make an opening deposit: Fund your account using an ACH transfer, check, or wire transfer2.
The entire process typically takes about 10 minutes, and you’ll have access to your account shortly after15.
Documents and Information You’ll Need
Before starting, gather the necessary documents to avoid delays. Here’s what you’ll need:
- Social Security Number (SSN): Required for identity verification15.
- Government-issued ID: A driver’s license, passport, or state ID15.
- Funding source: A checking account for ACH transfers or a check for mobile deposits15.
For joint accounts, both parties must provide their personal details and funding sources2. Minors may need a parent or guardian to co-sign the application.
Tip: Double-check your information to ensure accuracy. Errors can delay the approval process.
Security is a top priority. Banks use multifactor authentication and fraud monitoring to protect your account2. Always verify the bank’s FDIC or NCUA insurance status to ensure your funds are safe2.
Common Pitfalls to Avoid
Smart savers know that avoiding mistakes is just as important as finding great rates. Even accounts with competitive yields can underperform if you overlook hidden costs or changing terms16. Here’s how to protect your funds from sneaky drains.
Overlooking Fees and Fine Print
Monthly maintenance fees can erase interest gains. For example, CIT Platinum Savings requires a $5,000+ balance to earn its 4.10% APY—otherwise, fees apply16. Always check for:
- Inactivity penalties: Some banks charge $5–$10 after 12 months of no activity17.
- Paper statement fees: Opt for digital to avoid $3–$5 monthly charges18.
- Minimum balance requirements: TotalBank demands $25k for its top 4.47% rate16.
Ignoring Rate Variability
Promotional APYs often expire. SoFi’s rate drops to 1.00% without direct deposits, cutting earnings by 75%16. Watch for:
- Teaser rates: Banks like Capital One 360 adjust APYs without notice16.
- Balance tiers: Higher deposits may unlock better yields but limit access18.
| Pitfall | Example | Solution |
|---|---|---|
| Fee traps | $5 monthly maintenance fee | Choose fee-free accounts like Axos |
| Rate drops | SoFi’s APY falls to 1.00% | Set rate alerts or opt for fixed-rate CDs |
Pro tip: Enable rate change notifications and review terms annually. The FDIC’s Consumer Protection Toolkit helps spot red flags17.
Alternatives to High-Yield Savings Accounts
Exploring other financial tools can help diversify your portfolio and maximize returns. While high-yield options are great, alternatives like money market accounts and Certificates of Deposit (CDs) offer unique benefits worth considering19.
Money Market Accounts: Pros and Cons
Money market accounts (MMAs) combine the flexibility of checking accounts with the higher interest rates of savings accounts. For example, Vio Bank offers an MMA with a 4.41% APY2. However, they often require higher minimum deposits and may charge fees1.
Here’s what to consider:
- Check-writing privileges: MMAs often allow check-writing, making them more accessible19.
- Higher minimums: Some accounts require $5,000 or more to earn top rates1.
- Fees: Watch for monthly maintenance or paper statement charges1.
Certificates of Deposit (CDs) for Higher Rates
CDs offer higher yields in exchange for locking your funds for a set term. The average 12-month CD yields 4.75% APY2. However, early withdrawals can incur penalties, affecting liquidity19.
Key features include:
- Fixed terms: CDs range from 3 months to 5 years, with longer terms offering higher rates1.
- Penalties: Withdrawing funds early can result in fees, reducing your earnings19.
- Laddering strategy: Staggering CD maturities can balance liquidity and yield2.
Both MMAs and CDs are excellent alternatives, but they come with trade-offs. Evaluate your financial goals and liquidity needs before choosing the right option for you.
Understanding FDIC Insurance and Safety
Protecting your money is as important as growing it. FDIC insurance ensures your deposits are safe, even if a bank faces financial challenges. This coverage is a cornerstone of financial security, offering peace of mind for your funds.
The FDIC insures up to $250,000 per depositor, per ownership category at each insured bank20. Ownership categories include single accounts, joint accounts, certain retirement accounts (e.g., IRAs), and trust accounts20. For example, if you have a single account and a joint account at the same bank, each is insured separately up to $250,00020.
What “Member FDIC” Really Means
When a bank displays “Member FDIC,” it means your deposits are protected by the Federal Deposit Insurance Corporation. This applies to institutions like Goldman Sachs Bank USA, Ally Bank®, Synchrony Bank, Varo Bank, N.A., and Capital One Bank21.
Here’s how coverage works:
- Single accounts: Insured up to $250,000 per depositor20.
- Joint accounts: Each owner’s share is insured up to $250,00020.
- Retirement accounts: IRAs are separately insured up to $250,00020.
How Credit Union Accounts Are Insured
Credit unions are insured by the National Credit Union Administration (NCUA), which provides similar protection to the FDIC. Both agencies cover up to $250,000 per depositor, per ownership category20.
For example, if you have a checking account and an IRA at a credit union, the checking account is insured up to $250,000, and the IRA is separately insured up to $250,00020.
| Account Type | Coverage Limit |
|---|---|
| Single Account | $250,000 |
| Joint Account | $250,000 per owner |
| IRA | $250,000 |
Tip: Use the FDIC’s Electronic Deposit Insurance Estimator (EDIE) to calculate your coverage20. This tool helps you understand how much of your money is protected.
Remember, not all fintech partner banks offer full FDIC insurance. Always verify coverage to ensure your funds are safe20.
Tax Implications of High-Yield Savings
Understanding the tax implications of your earnings can help you maximize your financial growth. Interest earned from a high-yield savings account is taxed as ordinary income at your marginal tax rate22. This means it’s added to your other income and taxed based on your federal tax bracket, which ranges from 10% to 37%23.
How Interest Earnings Are Taxed
If you earn $10 or more in interest, your financial institution will send you a Form 1099-INT by January 3123. This form details your interest earnings and must be included with your tax return24. Even if you earn less than $10, you’re still required to report all interest income on line 2b of Form 104022.
Here’s a quick breakdown of how interest is taxed:
| Income Type | Tax Treatment |
|---|---|
| Interest Earnings | Taxed as ordinary income |
| Tax-Exempt Alternatives | Municipal bonds, HSAs, Roth IRAs |
Reporting Requirements for Savers
Most states consider interest from high-yield savings accounts taxable, though specific rules vary24. For example, if you live in a state with no income tax, you may not owe state taxes on your interest earnings22. However, failing to report interest income can result in penalties, including potential backup withholding22.
To avoid issues, maintain accurate records of all interest earned. This includes:
- 1099-INT forms: Keep these for at least three years24.
- Bank statements: Verify interest amounts and ensure they match your tax filings22.
- Tax software: Use tools that integrate with your bank accounts for seamless reporting24.
For complex situations, such as significant interest income or multiple accounts, consulting a CPA is advisable24. They can help you navigate tax rules and ensure compliance.
Tip: Use the IRS’s Electronic Deposit Insurance Estimator (EDIE) to calculate your coverage and verify your bank’s FDIC insurance status22.
Historical Trends in Savings Rates
Understanding the evolution of interest rates can help you make informed financial decisions. Over the past two decades, savings rates have seen significant fluctuations, influenced by economic conditions and Federal Reserve policies25. For example, in the 1980s, rates peaked at 14.04%, driven by high inflation25. In contrast, the 2000s saw rates drop below 1%, reflecting a different economic climate26.
How Fed Rate Changes Impact APYs
The Federal Reserve plays a crucial role in shaping savings rates. When the Fed raises the federal funds rate, banks often increase their APYs to attract deposits25. For instance, Ally Bank’s APY rose from 1.85% in 2022 to 4.35% in 2024, reflecting these changes27.
However, rate cuts can have the opposite effect. In 2024, the Fed reduced rates by 1%, which could lead to lower APYs in the near future25. Monitoring these changes is essential for maximizing your returns.
Predictions for 2025 and Beyond
Looking ahead, experts predict that savings rates will remain elevated but may moderate as the Fed continues its rate-cutting cycle25. NerdWallet forecasts that the Fed will cut rates twice in 2025, potentially impacting APYs25.
Here’s a summary of historical and projected APYs:
| Year | Average APY |
|---|---|
| 1981 | 14.04% |
| 2009 | 0.06% |
| 2024 | 0.47% |
| 2025 (Projected) | 0.35% |
Tip: Set up rate alerts to stay informed about changes and adjust your strategy accordingly25.
Tips for Maximizing Your Savings
Growing your money doesn’t have to be complicated—here are some practical tips to help you maximize your savings. By automating deposits and organizing your funds into multiple accounts, you can achieve consistent growth and stay on track with your financial goals28.
Automating Deposits for Consistent Growth
Automating your savings is one of the most effective ways to ensure consistent growth. 87% of savers succeed with automation, making it a key strategy for building wealth28. Setting up direct deposits or automatic transfers ensures that a portion of your income goes directly into your account without requiring manual effort28.
Budgeting apps like RocketMoney and Mint can help track expenses and redirect funds into high-yield accounts28. This approach not only simplifies the process but also helps you stay disciplined with your savings goals.
Using Multiple Accounts for Different Goals
Organizing your funds into multiple accounts can help you manage different financial goals more effectively. For example, you might use one account for an emergency fund and another for a vacation fund29. This separation makes it easier to track progress and avoid dipping into funds meant for other purposes.
Tools like SoFi Vaults enable goal tracking, allowing you to allocate funds to specific objectives28. By using multiple accounts, you can ensure that each dollar is working toward a specific purpose, maximizing your overall financial growth.
Tip: Consider using round-up apps to save spare change from everyday purchases. These small amounts can add up over time, providing an extra boost to your savings29.
Frequently Asked Questions About High-Yield Savings
Have questions about how to make the most of your financial tools? We’ve got answers. Below, we address common concerns to help you feel confident about your choices.
Can You Lose Money in a High-Yield Account?
No, your principal is safe in a high-yield savings account as long as it’s FDIC-insured. This protection covers up to $250,000 per depositor, ensuring your funds are secure even if the bank faces financial challenges30.
Here’s how it works:
- FDIC/NCUA insurance: Protects your deposits in banks and credit unions31.
- Bank failure processes: In the unlikely event of a bank failure, your money is returned up to the insured amount31.
- Low risk: Unlike the stock market, these accounts offer guaranteed returns without the risk of losing your initial investment31.
Always verify your bank’s insurance status using the FDIC’s online lookup tool for peace of mind30.
How Often Do Rates Change?
Rates on high-yield savings accounts are variable and can change 0–3 times per month, depending on the bank and economic conditions30. While this variability can be unpredictable, most banks notify customers of rate changes through email or mobile alerts30.
Here’s what to know:
- Rate change notifications: Enable alerts to stay informed about adjustments30.
- Teaser rates: Some banks offer promotional APYs that drop after a few months, so read the fine print30.
- Economic factors: The Federal Reserve’s decisions often influence APYs, so monitor broader trends30.
For consistent growth, consider accounts with fixed-rate options or laddering strategies to balance variability30.
Tip: If you encounter issues with your account, the CFPB complaint portal is a helpful resource for resolving disputes30.
Conclusion
Start maximizing your financial growth today with the right tools. Our top picks, like Axos Bank with its 4.66% APY and Bread Savings for low deposits, offer flexibility and strong returns32. Monitoring rates regularly ensures you stay ahead and make the most of your funds33.
Don’t wait—opening an account now can help you avoid missed opportunities. Diversifying across multiple options, such as banks credit unions, can optimize your earnings and spread risk33. With FDIC insurance, your deposits are protected, giving you peace of mind34.
Take the next step by researching top accounts, comparing features, and starting your journey toward financial security. Your future self will thank you.
FAQ
What makes a high-yield account different from a traditional one?
These accounts offer significantly higher interest rates, often 10–20 times the national average. Unlike standard options, they help your money grow faster with minimal effort.
Why does APY matter when comparing accounts?
Annual Percentage Yield (APY) reflects your actual earnings, including compound interest. A higher APY means more growth over time, so it’s a key factor in choosing where to save.
Are online banks safer than traditional ones for savings?
Both are secure if they’re FDIC-insured or NCUA-insured for credit unions. Online banks often provide better rates because they have lower overhead costs.
How frequently do interest rates change?
Rates can shift based on the federal funds rate and market conditions. Some banks adjust them monthly, while others may hold steady for longer periods.
What’s the biggest mistake people make with these accounts?
Overlooking fees or minimum balance requirements can eat into earnings. Always read the fine print to avoid surprises.
Can I lose money in a high-yield savings account?
No, your principal is protected up to 0,000 per account with FDIC insurance. However, inflation could reduce purchasing power if rates don’t keep pace.
Do I need a large deposit to open an account?
Many banks require as little as
FAQ
What makes a high-yield account different from a traditional one?
These accounts offer significantly higher interest rates, often 10–20 times the national average. Unlike standard options, they help your money grow faster with minimal effort.
Why does APY matter when comparing accounts?
Annual Percentage Yield (APY) reflects your actual earnings, including compound interest. A higher APY means more growth over time, so it’s a key factor in choosing where to save.
Are online banks safer than traditional ones for savings?
Both are secure if they’re FDIC-insured or NCUA-insured for credit unions. Online banks often provide better rates because they have lower overhead costs.
How frequently do interest rates change?
Rates can shift based on the federal funds rate and market conditions. Some banks adjust them monthly, while others may hold steady for longer periods.
What’s the biggest mistake people make with these accounts?
Overlooking fees or minimum balance requirements can eat into earnings. Always read the fine print to avoid surprises.
Can I lose money in a high-yield savings account?
No, your principal is protected up to $250,000 per account with FDIC insurance. However, inflation could reduce purchasing power if rates don’t keep pace.
Do I need a large deposit to open an account?
Many banks require as little as $1 to start, though some, like BrioDirect, ask for higher minimums. Always check the requirements before applying.
How are interest earnings taxed?
The IRS treats them as taxable income. You’ll receive a 1099-INT form if you earn $10 or more in interest annually.
to start, though some, like BrioDirect, ask for higher minimums. Always check the requirements before applying.
How are interest earnings taxed?
The IRS treats them as taxable income. You’ll receive a 1099-INT form if you earn or more in interest annually.