Here's Why I Keep a Savings Account That Only Pays 0.01% APY

I'm a little ashamed to admit it, but I have a savings account with a big national bank that pays just 0.01% APY. I've had the account for more than a decade, and even though my life has changed significantly in that time, I'm still getting value from the account despite its obvious shortcomings. Here's why I'm not planning to close this account anytime soon.

Overdraft protection

This is the main reason I maintain my traditional savings account. In my younger and broker days, I didn't have much extra cushion in my checking account between paydays, so I relied more heavily on this savings account for overdraft protection. If a bill was debited out of checking at the wrong time, cash would be transferred automatically from savings to keep me out of the red.

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I don't live paycheck to paycheck anymore, but I do keep a pretty small cushion in my checking account (just $500) because after years of that broke lifestyle, I now want to earn interest on as much of my cash as possible (more on that below). So if I happen to misfigure my bills for a given month, it's nice to know I still have that overdraft backup.

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Product	APY	Min. to Earn
American Express® High Yield Savings Account Member FDIC. APY 3.70% Rate info 3.70% annual percentage yield as of April 21, 2025. Terms apply. Min. to earn $0 Open Account for American Express® High Yield Savings Account On American Express's Secure Website. Member FDIC.	3.70% Rate info 3.70% annual percentage yield as of April 21, 2025. Terms apply.	$0	Open Account for American Express® High Yield Savings Account On American Express's Secure Website.
CIT Platinum Savings Member FDIC. APY 4.10% APY for balances of $5,000 or more Rate info 4.10% APY for balances of $5,000 or more; otherwise, 0.25% APY Min. to earn $100 to open account, $5,000+ for max APY Open Account for CIT Platinum Savings On CIT's Secure Website. Member FDIC.	4.10% APY for balances of $5,000 or more Rate info 4.10% APY for balances of $5,000 or more; otherwise, 0.25% APY	$100 to open account, $5,000+ for max APY	Open Account for CIT Platinum Savings On CIT's Secure Website.
Barclays Tiered Savings Member FDIC. APY 4.10% Rate info Balances less than $250,000 earn 4.10%, and balances greater than $250,000 earn 4.30%. Min. to earn $0 Open Account for Barclays Tiered Savings On Barclays' Secure Website. Member FDIC.	4.10% Rate info Balances less than $250,000 earn 4.10%, and balances greater than $250,000 earn 4.30%.	$0	Open Account for Barclays Tiered Savings On Barclays' Secure Website.

A convenient place to keep big bill payments

My big-bank savings account also gives me a convenient place to save money for my two biggest bills every month.

I put money aside weekly for my mortgage payments and monthly health insurance payments by transferring the cash out of my checking account to savings. It can sit there and earn a few pennies before I pay those bills at the end of the month. This is the best way I've found to approach tackling these payments without a ton of stress.

It's not my only savings account

I buried the lede here, but this low-APY savings account isn't my only one; I actually have two others. I have one with the credit union I got my mortgage through (it was required to officially join as a member) that pays only 0.05% APY and that I have just a few dollars in.

The other is a high-yield savings account (HYSA) with an online bank that pays a whopping 3.85% APY as of this writing. That's notably far higher than the current average interest rate across all savings accounts -- 0.43%.

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I keep the vast majority of my savings, including my emergency fund and my quarterly tax payments, in my online HYSA. I actually look forward to receiving my interest payment every month. And it might sound counterintuitive, but I don't mind the slight inconvenience this account presents.

For example, it didn't come with an ATM or debit card -- I had to open a linked checking account to get one of those. If I want to access my savings, I have to transfer money to that checking account so I can either visit an ATM or use the debit card to make a purchase. But this extra step is enough to give me pause about spending money from my savings -- I might not hesitate as much if it were easier to access.

Why not switch banks entirely?

You might wonder why I don't just give up my big bank checking account entirely and use this one instead. Honestly, I might not love my savings account and its low APY, but I'm very fond of the checking account it's linked to.

I've had it for 15 years, it doesn't have any fees, and is unfailingly easy to use. Plus, having branch access and a plethora of ATMs available has come in handy in the past -- such as when I needed to get a cashier's check to close on my mortgage earlier this year.

Should you keep your big bank savings account?

I'm definitely not alone in having a savings account that pays such a low APY. For those of us who've been banking since before online banks existed, it used to be our only real option. Since I'm getting value from the account in the form of overdraft protection and a handy place to keep bill payments, I'm not planning to get rid of it.

But if you have all your savings in an account paying just pennies a year, you should consider opening another account. Having some of your savings in such an account (especially if you're using it for overdraft protection) is a wise move -- cash in multiple banks means you'll have options in case you need money or one of your bank accounts is inaccessible for some reason.

Online banks have a lot of advantages over their brick-and-mortar counterparts. Not only will you get much higher APY on your savings, but your account will come with no or minimal fees, and you'll likely enjoy a well-designed and user-friendly mobile app. Since online banks exist purely in cyberspace, their digital offerings tend to be top notch.

Consider your options among online banks and pick a new savings account that'll help you grow your money, rather than just collect a cent or two here and there.