Rates on savings accounts are mixed compared to one week ago. You can now earn 4.26% or higher on your savings.
In the market for an account where you can park some cash? Here’s a look at some of the best savings rates you can find today.
Related: Compare the Best High-Yield Online Savings Accounts
Traditional Saving Account Rates Today
Traditional savings accounts, called “statement savings accounts” within the banking industry, are infamous for paying teensy interest rates. That’s starting to change, thanks to the Fed’s campaign of interest rate hikes to combat inflation.
Today’s highest APY on a standard savings account with a $2,500 minimum deposit requirement is 4.26%, according to data from Curinos. If you spot a basic savings account with a rate in that ballpark, you’ve found a good deal. One week ago, the best yield was 4.22%.
But today’s average APY for a traditional savings account is 0.22%, Curinos says, and that’s up from 0.22% a week ago. APY, or annual percentage yield, reflects the actual return your account will earn in a year. It includes compound interest, which is interest that builds on the interest already in your account.
High-Yield Savings Account Rates Today
High-yield savings accounts often pay much higher interest than conventional savings accounts. But the catch is you may have to meet tough requirements set by the bank or credit union. Often, that means making a large deposit to open the account.
On high-yield accounts requiring a minimum deposit of $10,000, today’s best interest rate is 4.51%. That’s up from 4.22% one week ago.
The average APY for those accounts is now 0.23% APY, about the same as a week ago.
On high-yield savings accounts with a minimum opening deposit of $25,000, the highest rate offered today is 4.89%. You’ll be in good shape if you can get an account offering a rate close to 4.89%. Last week at this time, the best rate was 4.22%.
The current average is 0.24% APY for a high-yield account with a $25,000 minimum deposit. That’s above last week’s 0.23%.
Money Market Account Savings Rates Today
Money market accounts (MMAs) are savings accounts that mix in some of the features of checking accounts. Often, you can write checks and have some debit card privileges.
MMAs tend to pay marginally higher interest than standard savings accounts. The FDIC says the average MMA rate is 0.62% compared to 0.43% for a traditional savings account.
But today, the best money market accounts have rates as high as 5.08%. That’s steady with the top rate of 5.08% from one week ago.
The average APY for an MMA is now 0.54%, up from 0.53% last week at this time, according to Curinos.
Related: Savings Rates Forecast September 13, 2023
How to Find a Savings Account
To find the best savings account for your needs, you first must answer the question: What exactly are you looking for? And you must realize that different types of accounts have trade-offs.
If you want to open an account at a traditional bank with branches, that will likely rule out the best interest rates, which are typically available at online-only banks. Many traditional savings accounts at brick-and-mortar banks earn just 0.01% or 0.02% APY, while some online-only savings accounts earn more than 4.00% APY.
Don’t settle on any option until you’re certain you have a good grasp on the fees you’ll be charged. Savings accounts can ding you with monthly service fees, excess withdrawal fees and returned item fees (if you deposit checks that bounce), among others. Those charges add up and can gnaw away at your savings.
As you shop around, check reviews and ratings of financial institutions and make sure you choose one that will protect your money with federal insurance—from the FDIC or, in the case of credit unions, the NCUA.
How High Can Savings Rates Go?
That’s tough to say—it depends on the path of inflation and the overall economy.
The highest interest rates in recent history were seen in the early 1980s when the Fed hiked the federal funds rate to over 19%. That was in response to record-breaking inflation that had prices rising at a rate of over 14% annually.
In the early 1980s, the average five-year CD paid almost 12%, compared to less than 2% today, according to Bankrate data. Savings rates eventually fell as inflation cooled and the federal funds rate was brought back down.
Methodology
Curinos determines the average rates for savings accounts by focusing on those intended for personal use. Certain types of savings accounts—such as relationship-based accounts and accounts designed for youths, seniors and students—are not considered in the calculation.
