Every available dollar that you can use to build your savings counts, but nowadays some banks are still siphoning off your precious funds in the form of monthly fees. Whether you’re a seasoned long-term saver, or just beginning to set aside some of your hard-earned money, where you decide to park your savings can make a big difference to your return.
Many profitable financial institutions offer no-fee savings account options that allow you to save for a rainy day or prepare for a special treat you’ve been planning without “nickel and diming” you with fees.
Choosing the best no-fee savings account will, above all, be a highly individual decision. “Consider what features are important to you,” said Jenn Schell, financial researcher for Annuity.org. “If earning the most interest is your biggest priority, then choosing an online high-yield savings account might be the best option.” Given that the top-yielding no-fee savings accounts today are offering rates as high as 5%, it’s best to shop around for the account that gives you the best return without eating it away with fees.
What is a no-fee savings account?
A no-fee savings account, also known as a free savings account, is a deposit account offered by banks, credit unions and neobanks that allow you to store your cash without paying fees for basic banking services such as monthly maintenance fees.
A traditional savings account may charge fees for not meeting the minimum balance requirement. That’s where no-fee savings accounts can help. Some banks waive these fees for no-fee savings accounts allowing your money to grow faster without incurring additional costs.
No-fee savings accounts don’t scrimp on services that come with traditional savings accounts. In most cases, you can still deposit and withdraw funds, earn interest and access banking services online or via a mobile app.
However, some banks, credit unions or neobanks that offer no-fee savings accounts still charge for services such as paper statements, wire transfers and excessive withdrawals.
The best no-fee savings accounts
We narrowed down the top-yielding no-fee savings accounts that offer a combination of competitive annual percentage yields, widespread accessibility and are federally insured by either the Federal Deposit Insurance Corporation or National Credit Union Administration.
Newtek Bank
- APY
- 5.00%
- Min. deposit to open
- $0
- Min. balance to open
- $0
- No monthly fees, minimum deposit or balance requirements
- Mobile check deposits via app
- No service or transaction fees
- Limit of six withdrawals per statement cycle
- 24/7 live customer support
Newtek Bank is the online-only arm of Newtek One. The 5.00% APY applies to all balance levels, but you’ll be limited to six withdrawals per statement cycle. However, the account doesn’t come with an ATM card. You can open as many personal banking accounts as needed, all of which can be managed through an online banking account or mobile app. So if you don’t want to manage your account online or need to make more than six withdrawals per statement cycle, it may not be the best option for you.
CIT Bank
- APY
- 4.95%
- Min. deposit to open
- $100
- No monthly fees
- $100 minimum deposit required
- Three savings account options available
- Mobile check deposits via app
- $5,000 balance required to earn the highest APY
- Rebates up to $30 per month in out-of-network ATM fees
CIT Bank is the online division of First Citizens Bank. It offers three types of savings accounts. The Platinum Savings account doesn’t charge a monthly maintenance fee but requires a $100 minimum deposit to open an account. You can receive up to $30 per month in reimbursements for out-of-network ATM fees.
A 0.25% APY applies to balances below $5,000, otherwise, you’ll earn a competitive 4.95% APY on any balance of $5,000 or more. The app makes mobile check deposits and transfers easy.
UFB Direct
- APY
- 4.81%
- Min. deposit to open
- $0
- No monthly fees, minimum deposit or balance requirements
- Mobile check deposits via mobile app
- Expanded insurance protection available up to $150 million
- ATM card available
UFB Premier Savings has a highly competitive APY that applies to all balances — unlike some banks highlighted above that reserve top APYs for specific balance tiers.
In addition to great rates, we like that UFB Direct’s savings account comes with a free ATM card and unlimited free transfers between accounts. However, there’s a limit of six withdrawals a month and after that, there’s a $10 excessive transaction fee. That doesn’t apply to ATM cards, though. As an online-only bank, UFB Direct doesn’t offer physical branches, but you can handle deposits and transfers through its mobile banking app, online and SMS mobile banking.
Upgrade
- APY
- 4.81
- Min. deposit to open
- $1,000
- No monthly or transfer fees
- $1,000 balance required to earn APY
- Mobile check deposits via mobile app
Upgrade’s Premier Savings accounts are held at Cross River Bank, a federally-insured bank in New Jersey. There are no monthly or transfer fees. However, only accounts with balances of $1,000 or more will earn the competitive APY. While Upgrade’s savings account doesn’t offer ATM or debit cards, you can initiate deposits or withdrawals through ACH transactions or wire transfers.
Laurel Road
- APY
- 4.80%
- Min. deposit to open
- $0
- No monthly fees, minimum deposit or balance requirements
- Mobile check deposits via app
- Debit cards are not available with the High Yield Savings account
Laurel Road’s savings account doesn’t require a minimum deposit or balance to earn its competitive 4.80% APY. According to its website, your interest rate may vary based on a few factors, such as your relationship with the bank and balances on other Laurel Road accounts. However, Laurel Road doesn’t accept cash deposits, so you’ll need to transfer funds and manage your account online.
Panacea Financial
- APY
- 4.80%
- Min. deposit to open
- $25
- No monthly fees or balance requirements
- Minimum $25 deposit required
- Mobile check deposits via app
- 24/7 live customer support
- Expanded insurance protection available up to $125 million
- Unlimited out-of-network ATM fee reimbursements
Panacea Financial is a financial institution that was created by doctors for doctors, but is open to everyone nationwide. It offers a high-yield savings account with a competitive APY that applies to all balance levels. Plus, you’ll have 24/7 live customer support by calling 833-472-6223.
What’s more is the added benefit sure to come in handy for those with larger balances: The PLUS Insured Cash Sweep offers expanded insurance for balances over $250,000 up to $125 million per tax ID.
Bask Bank
- APY
- 4.85%
- Min. deposit to open
- $0
- No monthly fees, minimum deposit or balance requirements
- Two savings account options available: one earns American Airlines miles, the other earns interest
- Doesn’t offer ATM or debit cards with savings account
- Mobile check deposits via app
Bask Bank is an online-only subsidiary of Texas Capital Bank that offers two savings accounts. The Interest Savings Account allows you to earn one of the most competitive APYs available.
There aren’t any deposit or balance requirements. However, Bask Bank reserves the right to close your account if it sits unfunded for 60 days. It allows six withdrawals per month from your account, but it doesn’t offer debit or ATM cards.
One major drawback is that the savings accounts don’t permit joint ownership. And Bask does not offer checking or money market accounts, which can be limitations for some if you want to keep your checking and savings accounts together or want to add a joint account holder.
TAB Bank
- APY
- 4.76%
- Min. deposit to open
- $0
- No monthly fees, minimum deposit or balance requirements
- $5 monthly fee for paper statements
- Full suite of deposit accounts available
- Mobile check deposits via app and text alerts
- Extended customer service hours
TAB Bank recently increased its already competitive savings APY to 4.76%. There’s no minimum balance or deposit required and you’ll only need one cent in your account to start earning interest.
Because TAB Bank is an online-only bank, we like that you can receive mobile alerts and text messages. For example, you’ll get a message about withdrawals when your account falls below a certain limit. Another benefit is that TAB has extended customer service hours — Monday through Friday from 6 a.m. to 7 p.m. MST and Saturdays from 9 a.m. to 3 p.m. MST, excluding federal holidays.
Bread Savings
- APY
- 4.75%
- Min. deposit to open
- $100
- No monthly fees
- Monitors and adjusts APYs based on market conditions to remain competitive
- Doesn’t offer ATM or debit cards with savings account
- Mobile check deposits via app
Bread Financial offers a high-yield savings account through its consumer arm Bread Savings. There’s a $100 minimum deposit to qualify for its competitive APY. There are no monthly maintenance fees and you can make unlimited free deposits via mobile check, ACH transfer and wire transfer. There are a few common fees, including $25 for outgoing wire transfers, $15 for official check requests and $5 for paper statements per statement. And Bread Savings doesn’t offer ATM cards.
Varo Bank
- APY
- 3.00% to 5.00%
- Min. deposit to open
- $0
- No monthly fees, minimum deposit or balance requirements
- Mobile check deposits via app
- Roundup tools to automate savings
- Highest APY available limited to balances up to $5,000
- Minimum of $1,000 in monthly direct deposits required to earn APY
Varo Bank is another bank on our list with a tiered savings rate that benefits lower balances. Savings accounts that maintain a maximum daily balance of $5,000 for the entire monthly billing cycle earn 5.00% APY. Amounts above $5,000 will earn 3.00% APY.
To qualify for any interest at all, you’ll need to have $1,000 in direct deposits every month. And you’ll need to have a positive balance in both your Varo Bank and Savings account at the end of each month. While Varo presents a tempting APY for those with lower balances, once your account balance exceeds $5,000, you’ll drop down to the lower APY.
However, we like that Varo offers more wiggle room to grow your stash with automatic round-ups to move your change from deposits and transactions to your savings.
Rates as of June 27, 2023.
Common savings account fees to avoid
Your savings account should help you save and earn more money — whether for emergency savings, a future expense such as a family vacation or to meet your savings goals. Fees work against your ability to maximize your savings. Here are some common charges associated with savings accounts that you should avoid when possible.
- Monthly maintenance fee: This is a monthly fee that is charged by financial institutions for maintaining an account. Sometimes this fee can be waived by meeting certain criteria such as signing up for eStatements or direct deposit. It’s best to avoid accounts with monthly maintenance fees or those without very simple options to waive the fee.
- Minimum balance fee: Some savings accounts require you to maintain a minimum balance to avoid incurring a fee. You want to avoid savings accounts that charge this type of fee, especially if you struggle to maintain a reasonable balance in your savings account.
- Excessive withdrawal fee: A Federal Reserve Board rule, Regulation D, historically limited the number of withdrawals or transfers you can make from your savings account to six per month. That rule was removed in 2020, but many banks maintain the withdrawal limit and charge a fee if you exceed it. Always track your withdrawals and note any limits in place to avoid this fee.
- ATM fees: If you use an out-of-network ATM, your bank may charge you an ATM fee. If you frequently use ATMs, look for an account that offers a significant number of ATMs in your area or reimburses ATM fees.
- Paper statement fee: Many financial institutions charge a fee for receiving paper statements by mail. Opt in to receive electronic statements will eliminate this fee.
- Account closure fee: Closing your savings account within a certain window may also trigger a fee. This window is generally 90 days or less and is in place to discourage account churning — opening and closing accounts in rapid succession to receive new account bonuses. Note any policies regarding account closure fees before closing the account to avoid surprises.
Additional no-fee savings account perks to consider
A savings account with no fees allowing you to keep more of your hard-earned money is a huge win. However, there are more perks to consider that can contribute to a healthy banking experience. “You may want to look for a bank with 24/7 customer support, especially if it’s an online bank with no physical locations,” said Schell. “You could also look for accounts with convenient features like mobile check deposit or online bill pay.”
Here are a few perks and features most banks offer and are worth considering for your savings goals.
- Competitive APY: Look for a no-fee savings account that offers a competitive APY. The best rate means your savings will grow faster over time, helping you maximize your returns.
- Account access: You’ll want access to your savings when you need it. Either through physical branches, a mobile and online platform or a combination of both. Make sure the bank you choose has the account access options you need to make banking easy and convenient.
- ATM access: Whether you need to withdraw cash frequently or not, think about the ATM network the bank offers and any fees associated with out-of-network ATMs. When you need to access your cash, avoiding ATM fees either because of an extensive network or out-of-network fee reimbursements will help you avoid paying unnecessary fees.
- Customer service: Note a financial institution’s options for reaching customer service. If in-person customer service is not available, many offer phone, email, or live chat support to address any concerns.
- Savings sub-accounts: Sub-accounts allow you to separate your savings into accounts with unique labels organized according to individual savings goals. You can set up a sub-account, for example, called My New Car Fund. Savings sub-accounts help you track your progress as you focus on completing a savings goal.
- Relationship benefits: Combining a no-fee savings account with other deposit accounts or services at the same bank, credit union or neobank can help you qualify for benefits such as higher interest rates, fee waivers or preferred customer status. These perks can help you decide between accounts at two institutions that have similar features.
- Sign-up bonuses: Although rare, some no-fee savings accounts may also offer a cash incentive to open a new account. These incentives can range from $50 to $500 and may require certain criteria to be met before the cash bonuses are disbursed.
How to open a no-fee savings account
Opening a no-fee savings account is a simple process. Once you’ve reviewed several options and selected a no-fee savings account, follow these general steps to complete the process.
- Gather the necessary information and documents to fill out your application. Usually, banks ask for a government-issued ID such as a driver’s license or passport, Social Security number and contact information.
- Visit the financial institution in person or complete the application online.
- Fund your account with an initial deposit once your application is approved. Some accounts require a minimum deposit account.
- If the option is available, you’ll need to set up online or mobile banking access to manage your savings account conveniently. Follow the instructions provided to set up your account access.
The bottom line
No-fee savings accounts can cut out the fees that many banks find unnecessary while keeping more money in your pocket. But it’s important to carefully review the terms and conditions of any savings account to understand all potential fees. There still may be some fees for non-routine services such as wire transfers or paper statements. Many banks offer no-fee or fee-waivable savings accounts, so it’s worth shopping around and comparing different options to find the best account for your needs.
FAQs
Many banks or credit unions may charge some fee even if the account is advertised as a no-fee or free savings account. Always review the fee schedule for a list of all potential fees that a savings account may incur. Oftentimes, the fee schedule is available on the bank or credit union’s website. However, you may need to reach out to the financial institution directly if that information is not readily available.
If the bank, credit union or financial institution is a member of the FDIC or NCUA, then the free savings account is federally insured for up to $250,000 per person, per institution. To see if your bank is insured, use the FDIC’s BankFind tool or visit the NCUA’s website.
It’s best to choose an account that advertises as a no-fee or free savings account. These accounts generally don’t charge a fee for monthly maintenance services, have a minimum balance requirement or incur transaction fees. It’s important to review the fee schedule, however, to understand additional fees that may be associated with the savings account, such as excess withdrawals or wire transfer fees.
