Key Takeaways
- Today’s top high-yield savings accounts earn up to 5.55% APY.
- Experts predict savings rates will drop later this year.
- Now’s the time to maximize your interest earnings with a high APY, because once the Fed drops rates, your APY will likely fall, too.
Savers have been able to enjoy the benefits of high savings rates for the last two years, but the clock is ticking. Once the Federal Reserve drops rates, your rate will likely drop, too.
Viorika/Getty Images
Whether the Fed moves to cut rates at its upcoming Federal Open Market Committee on July 30-31 largely hinges on the June Consumer Price Index and Producer Price Index reports due to be released this week, according to Ed Mahaffy, president and senior portfolio manager at ClientFirst Wealth Management.
“Although the consensus is for the Fed to begin cutting rates in September, if CPI and PPI fall appreciably, the Fed may cut rates at the July FOMC meeting,” said Mahaffy.
In other words, the sooner you open one of today’s top savings accounts, the more interest you stand to earn.
Experts recommend comparing rates before opening a savings account to get the best APY possible. You can enter your information below to see CNET’s partners’ rates in your area.
Today’s best savings rates
Here are some of the top savings account APYs available right now:
| Bank | APY | Min. deposit to open |
| My Banking Direct | 5.55% | $500 |
| TAB Bank | 5.27% | $0 |
| Newtek Bank | 5.25% | $0 |
| UFB Direct | 5.25% | $0 |
| Synchrony Bank | 4.75% | $0 |
| Capital One | 4.25% | $0 |
| Discover Bank | 4.25% | $0 |
| Ally Bank | 4.20% | $0 |
Why do savings rates change?
The Fed doesn’t directly impact savings rates, but its decisions have ripple effects on the everyday consumer.
When the Fed raises the federal funds rate — the interest rate US banks use to lend or borrow money to each other overnight — banks tend to increase their rates for savings accounts. Inversely, when the Fed lowers rates, banks drop savings rates, too.
Keep in mind savings rates are variable, which means banks can change the rate on your savings account at any time.
How long will savings rates remain high?
High savings rates have been the story for the better part of the last two years as the Fed regularly hiked rates to fight record inflation.
However, as inflation began to show signs of cooling in late 2023, the Fed opted to maintain its target range of 5.25% to 5.5% at its last seven Federal Open Market Committee meetings. As a result, savings rates have remained attractive, barely budging as banks anticipate the Fed’s next move. In fact, we haven’t seen any changes to the accounts we track since EverBank dropped the rate on its high-yield savings account on May 31 from 5.15% APY to 5.05% APY.
Experts anticipate rate drops before the end of the year, which means savings rates are likely to drop, too. While some expect rate drops as soon as July, others are hesitant to say a rate cut could happen that soon.
“For the Federal Reserve to consider lowering interest rates, they need to see a continued drop in inflation and assurance that it will not rise again,” said Anthony Saccaro, president at Providence Financial and Insurance Services. “Currently, the economic data does not justify a rate cut.”
Based on CNET’s weekly tracking, here’s where rates stand compared to last week:
| CNET Average Savings APY | Weekly Change* | FDIC Average |
| 4.88% | No change | 0.45% |
*Weekly percentage increase/decrease from July 1, 2024, to July 8, 2024.
Top reasons to open a high-yield savings account today
High-yield savings accounts provide a low-risk way to grow your savings while taking advantage of compound interest. Compound interest can help your money grow faster because you aren’t just earning interest on your initial deposit — your interest also earns interest.
Here’s what else makes HYSAs stand out:
- High rates: HYSAs often have APYs 10 times higher (or more) than the national average, as tracked by the Federal Deposit Insurance Corporation.
- Low or no fees: Monthly maintenance fees can eat into your savings. Many online banks can charge low or no fees thanks to their lower operating costs.
- Liquidity: You can access money in your HYSA anytime without penalty (as long as you mind any withdrawal limits).
- Accessibility: If you open an HYSA at an online bank, you’ll have 24/7 access through its mobile app. You may also have lots of customer service options, including by phone, online chat and secure messaging.
- Low risk: HYSAs are protected by federal deposit insurance if they’re held at an FDIC-insured bank or credit union insured by the National Credit Union Administration. That means your money is safe up to $250,000 per account holder, per account type.
Factors to consider when choosing a savings account
Though a high APY is important, you should consider more than just the APY before opening a high-yield savings account.
“Some accounts have mandatory minimums, transaction fees or other charges you might not expect,” said Ben McLaughlin, chief marketing officer and president of digital savings marketplace Raisin. “These hidden fees can chip away at your savings, so be sure you are satisfied with the terms and conditions before opening an account.”
Consider the following to find an account that complements your financial goals:
- Minimum deposit requirements: Some HYSAs require a minimum amount to open an account — typically, from $25 to $100. Others don’t require anything.
- ATM access: Not every bank offers cash deposits and withdrawals. If you need regular ATM access, check to see if your bank offers ATM fee reimbursements or a wide range of in-network ATMs.
- Fees: Look out for fees for monthly maintenance, withdrawals and paper statements. These charges can eat into your balance.
- Accessibility: If you prefer in-person assistance, look for a bank with physical branches. If you’re comfortable managing your money digitally, consider an online bank.
- Withdrawal limits: Some banks charge an excess withdrawal fee if you make more than six monthly withdrawals. If you think you may need to make more, consider a bank without this limit.
- Federal deposit insurance: Make sure your bank or credit union is either insured with the FDIC or the NCUA. This way, your money is protected up to $250,000 per account holder, per category, if there’s a bank failure.
- Customer service: Choose a bank that’s responsive and makes it easy to get help with your account if you need it. Read online customer reviews and contact the bank’s customer service to get a feel for working with the bank.
Methodology
CNET reviewed savings accounts at more than 50 traditional and online banks, credit unions and financial institutions with nationwide services. Each account received a score between one (lowest) and five (highest). The savings accounts listed here are all insured up to $250,000 per person, per account category, per institution, by the FDIC or NCUA.
CNET evaluates the best savings accounts using a set of established criteria that compares annual percentage yields, monthly fees, minimum deposits or balances and access to physical branches. None of the banks on our list charge monthly maintenance fees. An account will rank higher for offering any of the following perks:
- Account bonuses
- Automated savings features
- Wealth management consulting/coaching services
- Cash deposits
- Extensive ATM networks and/or ATM rebates for out-of-network ATM use
A savings account may be rated lower if it doesn’t have an easy-to-navigate website or if it doesn’t offer helpful features like an ATM card. Accounts that impose restrictive residency requirements or fees for exceeding monthly transaction limits may also be rated lower.
