What a Relationship Savings Account Is
A relationship savings account is a savings account that a bank or credit union offers to customers who also have a checking account or other product with them. The account comes with terms that reward you for maintaining multiple accounts at the same institution — usually through higher interest rates, waived fees, or both.
The word "relationship" refers to your overall banking relationship with that institution, not to a joint account with another person. A single person can open one. The bank's incentive is to keep you from moving your money elsewhere; your incentive is to earn more on your savings while paying less in fees.
These accounts are common at regional and community banks, less common at the largest national chains, and increasingly available at online banks. The specific perks vary widely by institution and change over time.
Key Takeaways
- A relationship savings account pays higher interest or waives fees because you maintain other accounts at the same bank, not because of your credit score or income.
- You typically need an existing checking account at that bank to open one, though some institutions waive this requirement if you meet a minimum deposit.
- Interest rates on relationship savings accounts are usually higher than standard savings accounts at the same bank, but you should compare them to online banks' rates before deciding.
- The perks disappear if you close your checking account or fall below the minimum balance, so read the terms before opening.
How the Interest Rate Works
Banks offer relationship savings accounts because they want you to keep money with them. A standard savings account at a large national bank might pay 0.01% annual percentage yield (APY). A relationship savings account at the same bank might pay 0.25% or higher, depending on your balance and how many other accounts you hold there.
The rate is not negotiable — it is set by the bank and applies to all customers who meet the account requirements. You do not earn a better rate by having a larger balance; instead, the bank may tier the rate so that balances above a certain threshold earn more. For example, balances under $25,000 might earn 0.15% APY, while balances of $25,000 or more earn 0.35% APY.
These rates change. Banks adjust them based on the Federal Reserve's interest rate decisions and their own funding needs. When you open the account, ask whether the promotional rate is permanent or temporary, and how often the bank reviews rates.
Requirements to Open One
Most banks require you to have an active checking account with them before you can open a relationship savings account. Some waive this requirement if you deposit a minimum amount — often $500 to $2,500 — into the savings account itself.
You will need to provide the same information as for any savings account: a government-issued ID, your Social Security number, and proof of address. The bank will run a soft credit check, which does not affect your credit score. Some institutions also require a minimum opening deposit, typically $25 to $100.
After you open the account, you must maintain it according to the bank's terms. This usually means keeping a minimum balance — often $500 to $1,000 — and keeping your linked checking account open. If your balance falls below the minimum or you close your checking account, the higher interest rate may disappear and you may be charged a monthly fee.
How Relationship Savings Accounts Compare to Other Options
A relationship savings account pays more than a standard savings account at the same bank, but it may not pay more than a high-yield savings account at an online bank. Online banks often pay 4% to 5% APY with no minimum balance and no requirement to hold other accounts. A relationship savings account at a brick-and-mortar bank might pay 0.5% to 1.5% APY.
The trade-off is convenience and service. If you value being able to walk into a branch, speak to a person, or move money between accounts instantly, a relationship savings account at your local bank may be worth the lower rate. If you are purely chasing the highest rate and do not need branch access, an online high-yield savings account will almost always win.
Money market accounts and certificates of deposit (CDs) are different products. A money market account is a hybrid between checking and savings, usually with a higher rate but limited withdrawals. A CD locks your money for a set term — three months to five years — in exchange for a may provide rate. Neither requires a relationship with the bank, though some banks offer better CD rates to customers who hold other accounts.
Fees and What Happens If You Break the Terms
A relationship savings account often waives the monthly maintenance fee that a standard savings account would charge. However, if you fall below the minimum balance or close your checking account, the fee may kick in — typically $5 to $10 per month.
Some banks also charge a fee if you exceed a certain number of withdrawals in a month. Federal rules once limited savings account withdrawals to six per month, but that rule was suspended. Banks can still set their own limits and charge for excess withdrawals, though many have stopped doing so.
If you close the account, you will receive the balance plus any accrued interest. The bank will send it to you by check or transfer it to another account you designate. There is no penalty for closing, but you will lose the higher interest rate on any money you move elsewhere.
When a Relationship Savings Account Makes Sense
A relationship savings account is worth opening if you already bank at an institution that offers one and you plan to keep your checking account there. The higher rate requires no extra work — you simply move money into the savings account and let it sit.
It makes less sense if you are shopping for the absolute highest savings rate. Online banks consistently beat brick-and-mortar banks on interest, and they do not require you to hold a checking account. It also makes less sense if you cannot maintain the minimum balance or if you are likely to close your checking account soon.
Some people open a relationship savings account as a way to separate their spending money (checking) from their savings, even if the rate is not the highest available. The psychological benefit of having money in a different account can make it easier to avoid spending it.
How to Compare Relationship Savings Accounts Across Banks
If you are considering opening a relationship savings account, gather the following information from each bank: the current APY, whether it is a promotional rate or permanent, the minimum balance required, the minimum opening deposit, and any monthly fees if you fall below the minimum.
Then compare that APY to what online banks are offering for high-yield savings accounts with no strings attached. Use a calculator to see how much interest you would earn on your expected balance over one year at each rate. A difference of 1% APY on a $10,000 balance is $100 per year — enough to matter if you are comparing a 0.5% relationship account to a 4.5% online account.
Read the fine print about what happens if your balance drops below the minimum. Some banks waive the fee if you maintain the minimum for most of the month; others charge it immediately. Ask whether the rate is may provide or whether the bank can lower it without notice.
Frequently Asked Questions
Can I have a relationship savings account at more than one bank?
Yes. You can open a relationship savings account at Bank A and another at Bank B, as long as you meet each bank's requirements. However, you would need a checking account at each bank to get the relationship perks, which means paying attention to multiple accounts and potentially multiple sets of fees.
What if I want to close my checking account but keep the savings account?
Most banks will let you keep the savings account open, but you will lose the higher interest rate and may be charged a monthly fee. The account becomes a standard savings account. It is usually cheaper to close both accounts and move your money to a bank that offers a better rate without requiring a checking account.
Do I need good credit to open a relationship savings account?
No. Banks do not check your credit score for savings accounts. They run a soft inquiry to verify your identity and check for fraud, but this does not affect your credit. Your credit history does not matter for a relationship savings account.
Can I earn interest on a relationship savings account if I never deposit money into it?
No. Interest is calculated on your balance. If you open the account but do not deposit money, you earn nothing. Some banks charge a monthly fee on an empty account, so do not open one unless you plan to fund it.
What happens to my interest if the bank lowers the APY?
Interest you have already earned stays in your account. If the bank lowers the rate going forward, only new interest accrues at the lower rate. For example, if you earned $50 at 1% APY and the bank drops the rate to 0.5%, you keep the $50 and future interest is calculated at 0.5%.