The Capital One 360 Savings Account Pays Almost Nothing, but Charges No Monthly Fee

Capital One 360 is a savings account with no monthly maintenance fee, no minimum balance requirement, and no penalty for withdrawals. The trade-off is the interest rate: as of early 2024, it sits around 0.01% annual percentage yield (APY), which means $10,000 in the account earns roughly $1 per year. That rate changes with Federal Reserve decisions and varies by the day you check it.

Whether this account makes sense depends on what you need it for. If you want a place to park money without fees while you decide what to do with it, or if you need a savings account tied to a checking account at the same bank, it works. If you are looking for interest earnings or competitive rates, you will find better options elsewhere.

Key Takeaways

  • Capital One 360 charges no monthly fee and has no minimum balance, so it costs nothing to hold money there.
  • The interest rate is very low—around 0.01% APY—so you earn almost no money on your savings.
  • You can link it to a Capital One 360 checking account for transfers, but you cannot link it to accounts at other banks.
  • High-yield savings accounts at other online banks currently pay 4% to 5% APY, earning hundreds of dollars per year on the same $10,000.
  • Capital One 360 is useful if you want a fee-free account at a bank you already use, not if you want to grow savings through interest.

How the Interest Rate Compares to Other Banks

Capital One 360's 0.01% APY is among the lowest rates available. Most high-yield savings accounts at online banks—including Marcus by Goldman Sachs, Ally Bank, and American Express Personal Savings—currently pay between 4% and 5% APY. On $10,000, that difference means earning $1 per year at Capital One versus $400 to $500 per year elsewhere.

Traditional brick-and-mortar banks often pay even less than Capital One 360, sometimes 0.01% or lower. But if you are comparing Capital One 360 to any online savings option, you are giving up significant earnings for the convenience of staying within one bank.

The rate you see today will change. The Federal Reserve controls the benchmark rate, and banks adjust their savings rates in response. Capital One 360's rate has historically moved slowly compared to competitors, meaning it often lags behind when rates rise and falls behind further when rates drop.

Fees and Account Rules

Capital One 360 charges no monthly maintenance fee, no overdraft fee (because it is a savings account, not checking), and no fee for withdrawals. You can make as many withdrawals as you want without penalty, though federal rules once limited savings withdrawals to six per month—that rule was suspended in 2020 and has not returned.

The account requires no minimum opening deposit and no minimum balance to keep the account open. You can deposit money by transfer from another Capital One 360 account, by direct deposit, or by mailing a check. You cannot deposit cash directly unless you visit a Capital One branch in person.

One limitation: you can only transfer money between Capital One 360 accounts. If you want to move money to a savings account at another bank, you have to withdraw it and deposit it separately—a process that takes one to three business days.

Who Should Use This Account

Capital One 360 makes sense if you already have a Capital One 360 checking account and want a linked savings account for the same bank. The transfers between accounts are instant, and you avoid the hassle of managing accounts at multiple institutions.

It also works if you need a savings account with no fees and no minimum balance, and you do not care about earning interest. Some people use it as a temporary holding place for money they plan to move elsewhere, or as a buffer account that sits mostly empty.

It does not make sense if your goal is to save money and earn interest on it. The rate is too low to justify choosing Capital One 360 over a high-yield savings account, even if you have to open an account at a different bank.

How to Move Money Out if You Switch

If you decide to move your savings to another bank, you can withdraw the full balance from Capital One 360 and deposit it into a savings account elsewhere. Withdrawals take one to three business days to clear, depending on the receiving bank.

You can also set up a one-time transfer from your Capital One 360 account to an external bank account, though Capital One 360 does not support automatic recurring transfers to outside banks. You will need your routing number and account number at the receiving bank.

Closing the account is straightforward: withdraw your balance, then contact Capital One to close it. There is no penalty for closing, and no requirement to keep the account open for any length of time.

Capital One 360 Checking and Savings Together

Many people open both a Capital One 360 checking account and a savings account because the two link instantly. Transfers between them show up immediately, and you can manage both from one login. The checking account also has no monthly fee and no minimum balance.

The checking account pays no interest on the balance, but it includes a debit card, online bill pay, and the ability to receive direct deposits. If you are already using Capital One 360 for checking, adding the savings account costs nothing and gives you a place to set money aside without moving it to another bank.

If you are not already a Capital One 360 customer, opening both accounts together makes more sense than opening just the savings account, because the checking account is also free and the two work together seamlessly.

Frequently Asked Questions

Can I earn more interest if I keep a higher balance?

No. The interest rate applies to your entire balance regardless of how much you have. A $100,000 balance earns the same rate as a $1,000 balance. The only way to earn more is to move your money to a bank with a higher rate.

Does Capital One 360 have FDIC insurance?

Yes. Capital One 360 is a division of Capital One Bank, and deposits are insured up to $250,000 per account holder by the Federal Deposit Insurance Corporation (FDIC). If you have multiple accounts at Capital One 360, each is insured separately up to $250,000.

Can I set up automatic transfers to save money each month?

Yes, if you are transferring from a Capital One 360 checking account. You can schedule recurring transfers from checking to savings. You cannot set up automatic transfers from an external bank account into Capital One 360 savings.

What happens if I do not use the account for a long time?

Capital One 360 does not close inactive accounts or charge dormancy fees. Your money stays in the account earning interest (however small) indefinitely. You can log in and withdraw or transfer money whenever you want.

Is Capital One 360 available in all states?

Capital One 360 is available nationwide, but some services vary by state. Check Capital One's website to confirm that all features you need are available in your state before opening an account.