The Best Savings Account Interest Rates and Yields | How to Find & Get the Top Account Rates

The Best Savings Account Interest Rates Compared to the Average Savings Account Interest Rate

When it comes to opening a savings account, most of us simply settle for whatever the local bank is offering.

If we’re looking to make a return on an investment, it’s best to play the stock market, or so we are told. Savings account interest rates are considered to be nominal at best, something that the banks throw at us to try and keep us happy.

Unfortunately, even the best interest rates for savings at most banks don’t offset the monthly charges and fees that accompany our accounts.

Finding savings accounts with the best interest rates, however, should be a part of everyone’s financial decisions. Since the national average for savings account interest is only 0.06%, many people feel that taking the time to search for savings account with best interest simply isn’t worth their time.

The extra pennies on the dollar that they might make simply isn’t worth the extra time and effort. However, few people have taken the time to explore the best savings account interest rates and how much they can differ from the national average.

In this brief article, AdvisoryHQ will explain why you should take the time to search for the best interest rates on a savings account. Furthermore, we will examine why some banks offer the best interest rates for savings accounts while others stick to the national average.

We will then go on to look at other things you should take into account besides savings account interest when deciding to open an account.

We will then look at where to find the best interest rates on savings accounts and review a few of the top online banks offering the best interest rates for savings.

Why Should You Search for the Best Interest Rates on a Savings Account?

Who wouldn’t want an extra couple hundred dollars each year? Even if you only have a few thousand dollars in savings, the best savings account interest rates can make a huge difference.

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While local banks may only offer savings account interest rates that differ slightly from the national average, online banks can offer the best savings account interest rates that are significantly higher.

While a difference between the average savings account interest rate of 0.06% and 0.08% will only amount to nickels and dimes, the difference between an interest rate on savings accounts of 0.06% and 1.1% is significant. If you have several thousand dollars in savings, the best interest rates for a savings account will quickly add up.

Furthermore, high-yield savings accounts that offer the best interest rates on a savings account can compare to other savings and investment tools that have less liquidity. For example, savings accounts with the best interest rates offered by quality online banks can compare to the rates offered by certificate of deposits (CD).

During economic downturns, the savings accounts with the best interest may even outcompete certain stocks and bonds.

For people who want a guaranteed investment with a decent rate of return, the best interest rates for savings offer you a quality alternative. With the best interest rates on savings accounts, you can enjoy the extra savings while also benefitting from the peace of mind knowing that your savings are 100% guaranteed by the FDIC.

Why Do Some Banks Offer the Best Interest Rates for Savings Account?

The banking industry is extremely competitive. As one of the largest and fastest growing sectors of our economy, banks, credit unions, and other financial institutions are always trying to gain clients.

By offering an interest rate significantly higher than the average savings account interest rate, many banks feel that they can increase their clientele.

Furthermore, while traditional brick-and-mortar banks have high overhead costs associated with maintaining several physical branch locations, online banks typically have lower costs and employ fewer people. This allows them to offer savings accounts with the best interest rates out there.

Some of the larger, national banks also offer savings accounts with best interest. Their massive size and large clientele allow them to increase the percentage yield on the best savings account interest rates.

Credit unions are financial institutions owned by their members. Since many credit unions are non-profit organizations, they also may be able to offer the best interest rates on a savings account.

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Other Things to Take into Account Besides Savings Account Interest

While some banks may very well offer the best interest rates for a savings account, it’s important to be aware of the fine print written into any account you may sign up for.

Banks know that most people only look for the best savings account interest rates while not taking into account other fees and charges that may accompany that account.

The best interest rates on a savings account won’t amount to much if you have to pay an expensive monthly fee. For example, if you have an average monthly balance of $1,000 with a 1% APY interest rate on savings accounts, you would only be a making $10 per year, or less than $1 per month. If your bank is charging you a $5 monthly fee, the best interest rates for your savings account wouldn’t even come close to offsetting the monthly fee.

Furthermore, it is important for you to have an idea of how you will use your savings account with best interest rates. All savings accounts have a maximum of six transactions per month.

However, some banks will charge you heavy fees for every transaction over the six permitted ones. If you feel that you need extra liquidity from your account, it is important to find the best interest rates for savings that also allow won’t charge you excessive fees for extra transactions.

If you tend to use ATM machines frequently, it is also important to find the best interest rates on a savings account that belongs to a large ATM network and that won’t charge you fees for using those ATMs.

Some accounts may charge you up to $2 for every ATM transaction. Even if you have the best savings interest rates, those fees will quickly cancel out any type of earnings associated with the savings account interest.

Where to Find the Best Interest Rates on Savings Accounts

One way to find the best interest rates for a savings account is to approach different local banks and credit unions. Some banks that are new to an area may offer their best savings account interest rates during the first months after opening as a way to attract clients.

If you feel that you don’t have the time to intensively search for the best interest rates for a savings account offered by physical banks in your town, you can also quickly find the best interest rates on a savings account offered by online banks. Below we’ll review a few of the online banks offering the best savings interest rates.

Best Savings Interest Rates by American Express High-Yield Savings Account

American Express is best known as a credit card company. However, they also offer quality savings accounts with some of the best savings account interest rates. The American Express High-Yield Savings Account offers a competitive 0.90% interest rate. This is one of the best savings account interest rates offered by a big name financial institution that is trusted by a large swath of Americans.

Furthermore, this account with the best savings interest rates has no minimum balance requirement, meaning that you’ll be able to benefit from the best savings interest rates even if your balance isn’t as high as you’d like. You can also link this best interest rates savings account to other accounts that you might have with other banks, credit unions, and other financial institutions.

Best Savings Interest Rates by Synchrony Bank

Synchrony Bank is fast becoming one of the best online banks offering the best interest rates on a savings account and other types of account. Their 1.05% interest rate is easily one of the best interest rates for a savings account that you can find anywhere in the country. On top of that, these best interest rates for a savings account also come with no monthly fee or minimum balance.

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If this best interest rate on a savings account weren’t enough by itself, Synchrony Bank also offers a number of perks and rewards programs for their clients. You can easily get discounts on car rentals and hotels by signing up for these best savings account interest rates.

Best Savings Interest Rates by Ally Bank

Ally Bank is another of the top online banks offering the best savings interest rates out there. With the Ally Online Savings Account, you get a solid 1.00% APY, easily one of the best interest rates on a savings account you can find anywhere.

Besides offering some of the best interest rates for a savings account, Ally Bank is also a national leader when it comes to online banking apps. Their mobile banking apps are easy to use and compatible with almost every type of mobile device. The customer service via live chat is another perk that comes with this best interest rates on a savings account.

Best Savings Interest Rates by Barclays Banks

Barclays Bank is one of the largest financial institutions out there. If you are looking for the best savings account interest rates offered by a big name bank, the Barclays Online Savings Account is for you. Furthermore, besides offering the best savings interest rates at 1.00% annual percentage yield (APY), this account also offers quality mobile apps and good customer service.

Best Savings Interest Rates by Capital One

The Capital One 360 Savings only offers a 0.75% APY, which is significantly lower than the other best interest rates for a savings account reviewed above. However, the 0.75% APY is still significantly higher than other savings account interest rates and several times higher than the average savings account interest rate.

Furthermore, with the Capital One 360, you will also benefit from a savings tracker which is meant to help you meet your personal goals for savings. For example, if you want to save $5,000 during the course of the year, this account with the best savings interest rates will let you know how much you need to deposit each week or month in order to meet your goal. You can also easily set up a direct transfer from a linked checking account.

Conclusion: Why the Interest Rate on Savings Accounts Matters for You

Taking the time to find the best savings account interest rates can lead to some long-term financial benefits for you. Not only will you benefit from the best savings interest rates, but you can also take advantage of the other benefits that come with online banking.

Instead of simply settling for the pittance interest rate offered by your local bank, finding the best interest rates on a savings account can help you better meet your financial goals.

AdvisoryHQ (AHQ) Disclaimer:

Reasonable efforts have been made by AdvisoryHQ to present accurate information, however all info is presented without warranty. Review AdvisoryHQ’s Terms for details. Also review each firm’s site for the most updated data, rates and info.

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