Bank of America does not offer a dedicated high-yield savings account

Bank of America's standard savings account earns interest, but the rate is substantially lower than what you can find at online banks or credit unions. As of early 2024, Bank of America's regular savings account pays around 0.01% annual percentage yield (APY) on balances under $100,000. That means on a $10,000 balance, you would earn roughly $1 per year in interest.

If you want a higher rate at Bank of America, your only option is to open a money market account, which typically pays a slightly better rate—but still well below what online banks offer. The trade-off is that money market accounts often require a higher opening deposit and may limit how many withdrawals you can make per month.

The reason Bank of America's rates stay low is that they operate thousands of physical branches. Maintaining buildings, staff, and ATM networks costs money, and those costs get passed along as lower interest rates to savers. Online banks have no branches, so they can pass most of their savings directly to you through higher rates.

Key Takeaways

  • Bank of America's regular savings account pays around 0.01% APY, which is roughly one-tenth of what online high-yield savings accounts currently offer.
  • Bank of America's money market account pays slightly more than savings but still lags behind online options and requires a higher minimum balance.
  • The difference between Bank of America's rate and an online bank's rate can mean hundreds of dollars per year on a $50,000 balance.
  • If you value in-person banking and branch access, you may choose Bank of America despite the lower rate, but you are trading interest earnings for convenience.

How Bank of America's savings rates compare to online banks

Online banks currently offer high-yield savings accounts paying 4% to 5% APY, depending on the bank and current market conditions. On a $10,000 balance, that is $400 to $500 per year—compared to $1 at Bank of America. On a $50,000 balance, the difference grows to $2,000 to $2,500 per year.

The gap exists because interest rates are set by the Federal Reserve, and all banks have access to the same base rate. What changes is how much of that rate each bank passes to customers. Banks with lower operating costs pass more of it along. Banks with higher costs—like Bank of America—keep more of it.

Credit unions often split the difference. Many credit unions pay 2% to 3% APY on savings, which is higher than Bank of America but lower than the best online banks. Credit unions are member-owned, so they return profits to members rather than shareholders, which can mean better rates on savings and lower fees on checking.

Bank of America's money market account as an alternative

Bank of America offers a Money Market Account that pays a tiered rate based on your balance. The more you deposit, the higher your rate. However, even at the highest tier, the rate remains significantly below online high-yield savings accounts.

Money market accounts come with restrictions that regular savings accounts do not have. Federal law limits you to six withdrawals per month (though this rule is enforced loosely). Some banks also charge a monthly fee if your balance drops below a minimum—typically $2,500 to $25,000 depending on the account type.

The money market account makes sense only if you already have a large balance at Bank of America and want to keep everything in one place. If your primary goal is earning interest, an online high-yield savings account will serve you better.

When Bank of America's savings account still makes sense

Low interest rates do not mean Bank of America is a bad choice for everyone. If you use Bank of America for checking and need easy access to your savings, keeping a savings account there eliminates the need to transfer money between banks. The convenience of one login and one relationship may be worth more to you than the extra interest.

Bank of America also offers overdraft protection, which links your savings account to your checking account. If you overdraw checking, the bank automatically transfers money from savings to cover it. This feature costs nothing and can prevent overdraft fees, though it only works if you keep a buffer in savings.

If you have a Bank of America credit card or mortgage, you may also may have access to for relationship discounts on fees or slightly better rates on other products. These perks rarely make up for the interest rate gap, but they are worth factoring in if you are already a multi-product customer.

How to move money to a higher-rate account without closing Bank of America

You do not have to choose between Bank of America and a high-yield savings account. Many people keep a checking account at Bank of America for daily spending and bill pay, then move extra money to an online savings account for interest.

Transfers between banks take one to three business days using ACH (Automated Clearing House), which is free. You can set up recurring transfers on a schedule—for example, moving $500 to your online savings account every payday—so the money moves automatically without you having to remember.

Some people use a high-yield savings account as their emergency fund and keep only their monthly spending money in Bank of America checking. This approach gives you the branch access and bill-pay convenience of Bank of America while earning real interest on the money you are not spending immediately.

What happens to your interest if rates drop

Interest rates move up and down based on Federal Reserve decisions. When the Fed raises rates, all banks eventually raise their rates too—though online banks usually move faster than traditional banks. When the Fed cuts rates, the opposite happens.

Bank of America tends to lag behind online banks when rates are rising, meaning you miss out on gains. When rates are falling, Bank of America also lags, which means you keep your low rate a bit longer—a small advantage that does not make up for the disadvantage during rate increases.

If you open a high-yield savings account now at 4.5% APY and rates drop to 2%, your rate will drop too. But you will still earn more than Bank of America's 0.01%, so the advantage persists even in a falling-rate environment.

Frequently Asked Questions

Can I earn more interest by keeping a larger balance at Bank of America?

Bank of America's regular savings account pays the same rate regardless of balance size. The money market account does pay higher rates at higher balances, but even the top tier remains well below online high-yield savings rates. You would earn more by moving the money to an online bank.

Does Bank of America charge a monthly fee on savings accounts?

Bank of America does not charge a monthly maintenance fee on regular savings accounts. Money market accounts may charge a fee if your balance falls below the minimum, which varies by account type. Check your account terms or call Bank of America to confirm the minimum for your specific account.

If I open a high-yield savings account elsewhere, can I still use my Bank of America debit card?

Yes. Your Bank of America debit card works with your Bank of America checking account. A high-yield savings account at another bank is separate and does not affect your debit card or checking. You would transfer money between accounts when you need it.

What if Bank of America raises its savings rate in the future?

Bank of America could raise rates, but historically it lags behind online banks. Even if Bank of America raises to 1% APY, online banks would likely be at 3% or higher. The gap may shrink, but online banks typically maintain an advantage because of their lower operating costs.

Is my money safer at Bank of America than at an online bank?

Both Bank of America and online banks are FDIC-insured up to $250,000 per account holder per bank. Your money is equally protected at either institution. The only difference is the interest rate you earn and how you access your account (in person versus online).