Where to find high yield savings accounts today

High yield savings accounts exist at online banks, some traditional banks with online divisions, and credit unions. The banks paying the highest rates right now are mostly online-only: Marcus by Goldman Sachs, Ally Bank, American Express Personal Savings, Discover Bank, and Capital One 360. Traditional banks like Chase, Bank of America, and Wells Fargo offer savings accounts, but their rates are typically much lower—often under 0.01% APY—because they rely on branch networks and don't need to compete aggressively for deposits online.

Credit unions can also offer competitive rates, though the rate varies by which credit union you join. Some credit unions pay rates comparable to online banks; others pay rates similar to traditional banks. The difference depends on the union's size, funding strategy, and membership base. You can search credit unions in your area through CO-OP or Allpoint to see what rates they advertise.

Rates change frequently—sometimes weekly—so a bank paying 4.5% APY today may pay 4.25% next month. The banks listed above have consistently ranked in the top tier for the past year, but you should check their current rates directly before opening an account. Bankrate, DepositAccounts, and the banks' own websites show real-time rates.

Key Takeaways

  • Online banks typically pay 4% to 5% APY on high yield savings accounts, while traditional brick-and-mortar banks usually pay under 0.5% APY.
  • Marcus, Ally, American Express, Discover, and Capital One 360 have consistently offered rates in the top tier, though rates shift monthly.
  • Credit unions vary widely in their rates; you need to check the specific union's current offer rather than assuming all credit unions pay the same rate.
  • You can move money between a high yield savings account and a checking account at the same bank, but federal rules limit you to six transfers or withdrawals per month from a savings account.
  • FDIC insurance covers up to $250,000 per depositor per bank, so if you have more than that, you will need accounts at multiple banks to keep all funds insured.

Why online banks pay more than traditional banks

Online banks have lower overhead costs than banks with physical branches. They don't pay for building leases, tellers, or branch staff. That savings gets passed to depositors as higher interest rates. A bank like Ally or Marcus can afford to pay 4.5% APY because they're not spending money on a branch on Main Street.

Traditional banks use deposits to fund loans—mortgages, car loans, business loans—and they keep the spread between what they pay depositors and what they charge borrowers. If a bank pays you 0.01% on savings but charges 6% on a mortgage, the bank keeps 5.99%. Online banks do the same math, but they compete for deposits by offering higher rates because they have fewer other ways to attract customers (no branch convenience, no relationship manager, no local presence).

This doesn't mean online banks are riskier. Most online banks are FDIC-insured the same way traditional banks are. Your money is protected up to $250,000 per account owner per bank, whether you bank with Chase or with an online bank you've never visited in person.

How to compare rates across banks

Rates are quoted as annual percentage yield, or APY. This is the rate you'll actually earn over a year, including the effect of compounding. When you see a bank advertising 4.75% APY, that's the number to use when comparing banks—not the annual percentage rate, or APR, which is used for loans and credit cards.

Check the current rate on each bank's website directly. Aggregator sites like Bankrate and DepositAccounts update frequently, but the bank's own website is the source of truth. Open a new tab for each bank you're considering and write down the APY, any minimum deposit requirement, and whether there are monthly fees. Most high yield savings accounts have no monthly fee and no minimum deposit, but some require $25,000 or more to earn the advertised rate.

Pay attention to whether the rate is promotional or permanent. Some banks offer a higher rate for the first three months to attract new customers, then drop the rate. The bank should disclose this clearly, but read the terms before you open the account. A rate that drops after 90 days is less valuable than a rate that stays the same.

What happens when you move money in and out

You can deposit money into a high yield savings account by linking it to a checking account at the same bank or a different bank. Most online banks let you link external accounts and transfer money via ACH, which usually takes one to three business days. Some banks also offer wire transfers, which are faster but may cost $15 to $25 per wire.

Federal rules limit you to six transfers or withdrawals per month from a savings account (the limit applies to transfers out, not deposits in). If you exceed six, the bank may charge a fee, close your account, or convert it to a checking account. This rule exists because savings accounts are meant to be for saving, not frequent spending. If you need to move money in and out constantly, a money market account or checking account may be a better fit.

Interest is usually deposited monthly. On the first of each month, the bank calculates how much interest you've earned and deposits it into your account. Some banks compound daily and deposit monthly; others compound and deposit monthly. The difference is small, but daily compounding is slightly better for you.

FDIC insurance and account limits

FDIC insurance protects your deposits up to $250,000 per depositor per bank. If you have $300,000 and put it all in one high yield savings account at Marcus, only $250,000 is insured. The other $50,000 is at risk if Marcus fails (which is extremely unlikely, but technically possible).

If you have more than $250,000 to save, you can open accounts at multiple banks to keep all funds insured. For example, $250,000 at Marcus and $250,000 at Ally means both amounts are fully insured. Each bank is a separate FDIC member, so the insurance limit applies separately to each one.

Joint accounts are insured separately. If you and your spouse have a joint savings account at Marcus, that account is insured up to $250,000 as a joint account. If you also have an individual account at Marcus in your name alone, that's insured up to another $250,000. The FDIC website has a calculator that shows you exactly how much of your money is insured across all your accounts.

Credit unions as an alternative

Credit unions are member-owned financial institutions, not shareholder-owned banks. Some credit unions offer high yield savings accounts that compete with online banks. Others offer rates similar to traditional banks. The rate depends entirely on the credit union's strategy and funding needs.

Credit union deposits are insured by the National Credit Union Administration (NCUA), not the FDIC. The coverage is the same: $250,000 per member per credit union. If you're a member of multiple credit unions, each one's insurance is separate.

To find a credit union near you, use the CO-OP or Allpoint locators on the Credit Union National Association website. Call or visit the credit union's website to ask what rate they're currently paying on savings accounts. Some credit unions require you to live or work in a specific area or belong to a certain employer or organization to join; others are open to anyone.

What to watch for when opening an account

Before you open an account, check whether the bank requires a minimum deposit. Most online banks have no minimum, but some require $25,000 or $100,000 to earn the advertised rate. If you have less, the bank may pay a lower rate or not let you open an account at all. This information should be clearly stated on the bank's website.

Confirm that the bank is FDIC-insured (or NCUA-insured if it's a credit union). The bank's website should display the FDIC logo and member number. You can also search the FDIC's bank database to verify.

Read the terms about transfers and withdrawals. Some banks limit you to a certain number of transfers per month; others don't. Some charge a fee if you exceed the limit; others convert your account to a checking account. Know the rules before you open the account so you're not surprised later.

Frequently Asked Questions

Can I move money between my high yield savings and checking account without losing interest?

Yes, if both accounts are at the same bank. You can transfer money between them as often as you want without penalty. However, federal rules limit you to six transfers or withdrawals per month from the savings account. Deposits into the savings account don't count toward this limit, only transfers out.

What if the bank lowers its rate after I open an account?

Banks can lower rates at any time. They must notify you before the change takes effect, usually by email or mail. You can close the account and move your money to a bank paying a higher rate. There's no penalty for closing a savings account, and transfers between banks take one to three business days.

Do I have to pay taxes on the interest I earn?

Yes. Interest earned on a savings account is taxable income. At the end of the year, the bank will send you a 1099-INT form showing how much interest you earned. You report this on your tax return. If you earned $10 in interest, you owe tax on that $10 at your ordinary income tax rate.

Is my money safe in an online bank I've never visited?

Yes, as long as the bank is FDIC-insured. FDIC insurance protects your deposits the same way whether you bank online or in person. You can verify a bank's FDIC status on the FDIC's website. Online banks are regulated by the same federal agencies as traditional banks.

Can I open accounts at multiple banks to earn higher interest on a larger amount?

Yes. You can open a high yield savings account at Marcus, another at Ally, and another at Discover. Each account earns interest at that bank's rate. This strategy also protects your deposits: if you have $500,000 across two banks ($250,000 each), all of it is FDIC-insured, whereas $500,000 at one bank would only be partially insured.