Best Savings Account Interest Rates of July 2024 Savings accounts are good for keeping money safe and liquid, but they aren’t great for earning money, are they? No, not necessarily. Several banks and credit unions offer savings accounts with respectable interest rates that rival CD rates without restrictions.
The best savings rates and deals are found by comparing more than 150 banks and credit unions every weekday. With these high-interest savings accounts, you can earn up to $250,000 per depositor per institution, and your funds are insured by the federal government. Our first step is to find the highest rates, and we prefer accounts with low minimum deposit requirements and reasonable fees.
Money market accounts are also included if they function like savings accounts. It means that if an account pays a high yield and doesn’t allow you to write checks, it’s in the mix.
The best high-interest savings accounts are identified by evaluating widely available accounts throughout the U.S. To help you compare options, we also take into account factors like how quickly interest compounds, how easy it is to make deposits, and how accessible the customer service is.
Best High-Yield Savings Accounts
| BANK OR CREDIT UNION | APY | REQUIREMENTS |
| Poppy Bank | 5.50% | $0 to open and $1,000 to earn stated APY |
| TotalDirectBank | 5.26% | $25,000 to open and $2,500 to earn stated APY |
| Newtek Bank | 5.25% | $0 to open and earn stated APY |
| UFB Direct | 5.25% | $0 to open and earn stated APY |
| Ivy Bank | 5.30% | $2,500 to open and earn stated APY |
| BrioDirect | 5.30% | $5,000 to open and $25 to earn stated APY |
| North American Savings Bank | 5.30% | $10,000 to open and $0 to earn stated APY |
Frequently Asked Questions
What Is a High-Interest Savings Account?
High-interest savings accounts, also known as high-yield savings accounts, let you grow your money while keeping it accessible. Depending on the bank, savings accounts offer varying rates of interest. A high-interest account’s unique feature is its relatively high interest rate. The best rates on these accounts are often 20 or more times the national average savings rate.
You can allow your savings to compound as you earn interest on them. Alternatively, interest is earned on interest payments made in previous months. Money grows faster at a higher rate.
What Should You Look for in a High-Yield Savings Account In 2024?
When shopping for a high-yield savings account, most people focus on the interest rate. Take the time to compare banks and pick a competitive interest rate, but don’t ignore other important factors.
- Low fees are crucial: You might lose any earnings in your account if you pay monthly maintenance fees (or even see your account balance drop each month).
- Verify that your money will be safe: The safest banks are FDIC-insured, and NCUSIF coverage is provided by the safest credit unions.
- Decide which bank will be most convenient for you to work with. Decide what you will use the account for, and choose a bank that fits your needs. Make sure the bank offers mobile deposit, for example, if you frequently deposit checks. A bank with an ATM network that is convenient for you or one that offers ATM rebates is a good choice if you withdraw cash regularly.
Why Do Savings Account Rates Change?
You can earn interest on your savings account over time. It is possible for a rate to remain the same for an extended period of time. Banks, however, typically move along with changes in the broad economy when interest rates change. There’s a good chance your savings account rates will remain stagnant or fall if the Fed cuts rates. Banks usually increase rates when rates rise, but perhaps not as quickly as you’d like.
Why Are Some Bank Interest Rates Higher Than Others?
Banks with big brick-and-mortar branches tend to offer lower interest rates than banks with online branches.
When banks want to collect money, they raise interest rates. Savings accounts with a high interest rate can be used to attract depositors if the bank needs deposits. However, they may be able to keep rates lower if they do not require cash.
Different banks earn money in different ways. There are some institutions that take deposits and lend them out, and there are others that take a more diversified approach (earning revenue and fees from other services such as credit cards and ancillary businesses).
The organizational structure should also be considered. It may be hard for some banks to pay high rates to depositors when shareholders demand growth (and/or share income). It is possible, however, for some banks to keep only what they need to pay the bills and share the rest of the income (from loans, ATM fees, etc.) with account holders. This model is most likely to be applicable to small banks and credit unions.
Is Savings Account Interest Taxable?
The interest you earn on your savings account is generally taxable as income. You should provide your bank’s Form 1099-INT to your tax preparer or include it with your tax filings.
If you have an individual account, joint account, or other taxable account, you are required to pay tax on the interest you receive. In contrast, if your account is part of a retirement account like an IRA, you may be able to postpone or avoid taxation.
