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What Is a Good APY for a Savings Account?

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Many or all of the products here are from our partners that compensate us. It’s how we make money. But our editorial integrity ensures that our product ratings are not influenced by compensation. Terms may apply to offers listed on this page. APY = Annual Percentage Yield. APYs are subject to change at any time without notice.

The current average savings APY is 0.42%. Since the Federal Reserve began increasing the federal funds rate in March 2022, average savings accounts interest rates have increased from 0.06% to 0.42%. The interest rate on 1-year certificate of deposits (CDs), typically one of the highest-yield savings vehicles, currently averages 1.84%.

Here are the average rates paid by all federally-insured depository institutions and credit unions for the most common interest-bearing bank accounts, based on the most recent FDIC data available as of Nov. 18, 2024.

Average national savings interest rates

Deposit Products National Deposit Rates  (Nov. 18, 2024)
Savings 0.43%
Interest Checking 0.08%
Money Market Account 0.60%
1-month CD 0.23%
3-month CD 1.52%
6-month CD 1.68%
12-month CD 1.84%
24-month CD 1.52%
36-month CD 1.35%
48-month CD 1.27%
60-month CD 1.35%
Data source: FDIC.gov, rates as of Nov. 18, 2024.

What's a good APY on a high-yield savings account?

While the average savings rate is 0.42%, the best high-yield savings accounts offer an APY ranging from 3.80% to 4.75%.

The best rates for savings accounts typically come from online-only banks. An online bank can offer higher rates since it doesn't have the same costs as brick-and-mortar banks.

Compare savings rates

Make sure you're getting the best account for you by comparing savings rates and promotions. Here are some of our favorite high-yield savings accounts to consider.

Account APY Promotion Next Steps
3.80%
Rate info Circle with letter I in it. 3.80% annual percentage yield as of December 27, 2024. Terms apply.
Min. to earn: $0
N/A
Open Account for American Express® High Yield Savings

On American Express's Secure Website.

up to 4.00%²
Rate info Circle with letter I in it. You can earn the maximum APY by having Direct Deposit (no minimum amount required) or by making $5,000 or more in Qualifying Deposits every 30 days. See SoFi Checking and Savings rate sheet at: https://www.sofi.com/legal/banking-rate-sheet.
Min. to earn: $0
New customers can earn up to a $300 bonus with qualifying direct deposits!¹
3.80%
Rate info Circle with letter I in it. See Capital One website for most up-to-date rates. Advertised Annual Percentage Yield (APY) is variable and accurate as of Dec. 6, 2024. Rates are subject to change at any time before or after account opening.
Min. to earn: $0
N/A

Is a high interest rate good for a savings account?

A savings account's annual percentage yield, or APY, is the amount of interest you earn in a year. Earning a higher APY can make a significant difference.

For example, $5,000 in an account offering the 0.42% national average APY would earn $21.50 per year. The same amount in an account earning a higher rate of 4.75% APY will earn $237.50 per year.

The beauty of compounding interest means this gap will only widen as time goes on. You should look for banks that offer high annual percentage yields. The higher the account's APY, the faster your savings will grow.

How to find a better savings account interest rate

How much interest you earn will vary a lot depending on the bank and account type. Online-only banks tend to have better rates since they do not have to pay the same overhead costs that brick-and-mortar banks do. Some online banks, and fintech companies that work with partner banks, also offer higher APYs on savings accounts because they're competing for customers' deposits.

Keep in mind that since the APY on a savings account is variable, the rate will fluctuate -- banks typically raise or lower their savings account APYs when the Fed raises or lowers interest rates. Banks can also change the APY on your savings account at their own discretion, whenever they choose.

An online high-yield savings account or credit union savings account may offer higher rates than the average bank can. Depending on the market outlook, CDs and money market accounts sometimes offer higher rates than savings accounts do. These could also be alternatives to try for a better rate.

If you find a better rate, ask your bank if it can match or beat it. If not, consider switching to another bank.

Motley Fool Money's best savings accounts

Many people are missing out on guaranteed returns as their money languishes in a big bank savings account earning next to no interest. Motley Fool Money's top savings account picks can earn you more than 10x the national average savings account rate.

Best Savings Accounts

FAQs

  • Yes, interest rates on savings accounts change based on various factors. The APY for savings accounts are variable rates and can change without notice. Banks will adjust their savings rates based on economic conditions and changes to the Federal Reserve's federal funds rate.

  • The national average interest rate for savings accounts is currently 0.42%. This is the average of rates paid by all insured depository institutions and credit unions for which data is available. Any account that pays more than this would be considered above average or high.

  • The interest rate for your savings account is the APY. You can look at your savings account statements or log into your account online to find the APY the bank is paying you. Typically, it's under the account details section. You can also contact your bank, check your bank's website or mobile app, or if your bank has brick-and-mortar branches, visit in person to find out the interest rate.