Best High-Yield Online Savings Accounts of July 2022

ElitePersonalFinance
Last Update: July 2, 2022 Banking Save Money Studies

With U.S. interest rates still stuck in a downtrend, the search for yield has become even more difficult. And while capital market participants have to endure volatility to earn a higher return, we have a list of savings options that can help grow your money without taking any risk.

Why Should You Trust ElitePersonalFinance?

With accuracy and accountability in mind, we pride ourselves on presenting the latest information from the most trusted sources. And our goal is to help you find the best products available in the marketplace. Moreover, we hope that our study will make it easier to determine where you should invest your hard-earned savings.

To do so, we analyzed hundreds of savings accounts and organized our findings by those that offer the highest annual percentage yields (APYs). However, what’s the point of a high-interest rate if you can’t depend on your institution? That’s why we ensured that all of the institutions on our list reported being insured by the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA).

As a result, all our recommended high-yield savings accounts are insured by the U.S. federal government up to $250,000 per person, per account.

Best High-Yield Savings Accounts July 2022

While all institutions on our list offer savings account interest rates of less than 1%, their APYs are still much higher than traditional banks. For example, the latest release from the Federal Deposit Insurance Corporation (FDIC) shows that the U.S. national average savings rate is 0.06%.

As a result, the high-yield savings accounts below are reliable alternatives for your short-term savings.

GO2bank Vault Savings

APY: 1.00%
Min. Balance Required: $0
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
Learn More

As a digital institution specializing in mobile banking, GO2bank offers one of the industry’s highest savings account interest rates. For context, the 1% APY applies to clients that open a “vault” savings account. And to be eligible, you need to have a day-to-day mobile banking account with GO2bank. However, the Fintech company charges no monthly fees if you enroll in eligible direct deposits. Otherwise, you incur a $5 monthly fee.

In addition, the 1% APY applies to savings balances of $5,000 or less, and the interest accrued is paid quarterly. However, if you have moderate savings and want to earn one of the highest interest rates with zero account fees, GO2bank checks off all boxes. To that point, your deposits at GO2bank are FDIC-insured up to $250,000 per person, per account.

As another benefit, bank account holders can receive up to 7% cash-back on e-gift card purchases. All you have to do is log into your account and canvass merchants’ offers. Once you find one that’s attractive, you can purchase it for yourself or send the gift card to another GO2bank account holder. Either way, the cash-back reward is yours.

GO2bank also makes it easy to conduct your day-to-day banking. For example, the Fintech firm has 90,000 retail deposit locations in the U.S. Whether it’s Walmart, CVS Pharmacy, or Dollar General, you can deposit money instantly by following these three simple steps:

  1. Travel to one of the 90,000 locations and bring your cash and your GO2bank debit card.
  2. Swipe your card and pass the money to the clerk.
  3. Check your GO2bank account to make sure the deposit is approved.

Likewise, you can also deposit money without a debit card. To do so, you obtain a barcode through GO2bank’s mobile app to facilitate the transaction. Then, you get the cashier at the retail location to scan the barcode and confirm the deposit. For context, the funds should be in your account within 10-15 minutes, though it’s prudent to keep your receipt in case of any hiccups.

However, please note that retail service fees can apply. And while GO2bank doesn’t specify the exact amount, its fee disclosures show that check deposits incur a service fee of 1% of the balance for pre-printed payroll and government checks. Moreover, all other cashed checks incur a service fee of 5% of the balance, and the minimum expense is $5.00 per transaction. Conversely, there are no fees for bill payments. However, bill payments are limited to a minimum of $1.00 and a maximum of $7,500.

Pros:

  • GO2bank allows you to move money seamlessly from your checking account to your savings account.
  • Your excess deposits earn interest while you determine the best use for the money.

Cons:

  • The maximum deposit is $5,000.
  • The firm doesn’t have any branches or physical locations.

Who is the account best suited for?

  • If you’re comfortable with mobile-only banking and have a small savings account, GO2bank is the perfect fit.
  • The firm has served 33 million clients, and customer support is available 24/7.
  • You can reach a representative through phone, live chat, or physical mail.

The impact of COVID-19:

Americans’ knowledge of Fintech companies increased during the pandemic. With stay-at-home orders forcing us to spend more time online, digital banking was a significant beneficiary. And by offering an FDIC-inured high-yield savings account with a higher APY than the competition, GO2bank hopes to maintain the momentum.

Affirm High-Yield Savings

APY: 0.65%
Min. Balance Required: $0
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
Learn More

As another Fintech company attempting to win new customers, Affirm’s High-Yield Savings Account offers the second-highest APY on our list. And like many of the other options, there are no balance minimums or account fees. Aiming to streamline the savings process, Affirm makes investing your money as easy as possible. For example, you can link your external bank account to transfer money back and forth, and interest compounds daily and pays you monthly. In addition, your money is held at Cross River Bank — Affirm’s partner financial institution. As a result, your deposits are FDIC-insured up to $250,000 per person, per account.

On top of that, Affirm’s business model is structured around buy-now-pay-later services. For context, the transaction is similar to an installment loan, as the proceeds incur interest and you make equal monthly payments. The company disclosures note that your APR can vary from 0% to 30%, depending on your creditworthiness. However, you can avoid interest if you follow Affirm’s “Pay in 4” guidelines and make four interest-free payments on a bi-weekly basis. This method has no interest or fees, and it won’t impact your credit score.

If you think Affirm is suitable for you, making a purchase is relatively straightforward:

  1. Add items to your checkout and select pay later with Affirm (you can also download the mobile app or use affirm.com).
  2. If you don’t already have an account, you must sign up.
  3. Await Affirm’s approval of the transaction.
  4. Choose between the Pay in 4 or the monthly installment methods.
  5. Set up automatic repayment or manage the payback schedule through Affirms app or at affirm.com.

Pros:

  • Affirm offers a solid high-yield savings account and access to credit solutions without using your credit card.
  • You can invest your money without having to enter into any credit agreements.

Cons:

  • The firm doesn’t have any branches or physical locations.

Who is the account best suited for?

  • Affirm is different from a mobile bank, offering installment loans and buy-now-pay-later options.
  • However, applying for a personal loan is usually a better option.

The impact of COVID-19:

With savings account interest rates closely linked to the overnight lending rate set by the Fed, Affirm’s disclosures noted a reduced APY during the pandemic. However, with the Fed poised to raise interest rates in 2022, all companies on our list should promote higher APYs later in the year.

Axos High-Yield Savings

APY: 0.61%
Min. Balance Required: $250
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
Learn More

If you can meet the opening minimum of $250, an Axos High-Yield Savings Account is a reliable option. In addition, there are no minimum monthly balance requirements once your application is approved. As a result, the $250 threshold is essentially a placeholder for setting up your account. And after that, you’re free to maintain the balance of your choosing.

For example, an Axos High-Yield Savings Account has a 0.61% APY on balances from $0 to $24,999.99. After that, balances from $25,000 to $99,999.99 earn 0.25% interest, and balances that exceed $100,000 earn 0.15% interest. However, with Axos Bank offering one of the highest annual interest rates among the institutions in our study, investing your short-term savings up to the $24,999.99 limit is a prudent option. Furthermore, Axos High-Yield Savings Accounts are FDIC-insured up to $250,000 per person, per account. In addition, the account doesn’t incur monthly maintenance fees, and you can start saving in as little as 15 minutes. All you need is valid identification and your Social Security Number.

Also noteworthy, Axos Bank is a full-service financial firm that offers checking and savings accounts and CDs. Moreover, you can also apply for mortgages, personal and auto loans, and its managed portfolios and self-directed brokerage services help you purchase stocks, bonds, and other financial market assets.

On top of that, Axos Bank is serious about security. For example, two-step identification keeps your account safe by asking you a personal question or sending a verification code to your device. In addition, SSL encryption keeps your data secure, while antivirus and malware protection keeps your account from suffering unwanted attacks.

Finally, Axos Bank’s blog is rich with content to help you make smarter money decisions. For example, you’ll find advice on how to streamline your spending habits, as well as how to navigate the mortgage and auto loan markets.

Pros:

  • Axos Bank offers a competitive APY.
  • The group’s security suite keeps your account protected from hackers.
  • You can obtain a free ATM card by contacting a representative.

Cons:

  • Balances of $25,000 or more earn much lower APYs.
  • The firm doesn’t have any branches or physical locations.

Who is the account best suited for?

  • Axos Bank is a reliable firm that offers several financial products.
  • If your savings balance is $5,000 or less, GO2bank offers a higher APY (1%).
  • If your savings balance is more than $5,000, Varo Bank’s APY (up to 3%) is more attractive.

The impact of COVID-19:

As another digital nomad, Axos Bank helped consumers navigate their way through the pandemic. However, with the bank enhancing the digital revolution since 2000, the firm has been around longer than many of its competitors.

LendingClub Bank High Yield-Savings

APY: 0.60%
Min. Balance Required: $2,500
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
Learn More

At LendingClub Bank, a high-end APY of 0.60% is yours for the taking. However, the only downside is that your need a minimum of $2,500 to qualify. And for balances of less than $2,500, you only earn a 0.05% APY. Conversely, there are no monthly maintenance fees, and you’re free to deposit any amount you wish. However, please note that you need to deposit $100 when opening the account. Moreover, your deposits are FDIC-insured up to $250,000 per person, per account. As mentioned, though, you need a relatively high balance if you want a worthwhile interest rate.

However, mirroring Axos Bank, Synchrony, Alliant Credit Union, and First Foundation Bank, a LendingClub Bank High-Yield Savings Account can process ATM withdrawals. As such, a free ATM card is available upon request. Likewise, you can also link an external bank account to streamline transfers to and from other institutions. However, please note that LendingClub Bank only lists two branches as of March 2021. Thus, the primarily online institution won’t provide you with the same in-person service as traditional banks. As a result, it’s prudent to consider the deposit requirements and your comfort level with online banking before making your final decision.

Pros:

  • LendingClub Bank offers one of the best APYs in the industry and there are no account fees.
  • You can obtain a free ATM card by contacting a representative.

Cons:

  • You need at least $2,500 to earn the 0.60% APY.

Who is the account best suited for?

  • If you have a high savings balance, LendingClub Bank is a solid choice.
  • If you live in Utah or Massachusetts, you should be able to obtain in-person service.

The impact of COVID-19:

With pandemic-induced stimulus flooding the system with cash, LendingClub Bank’s deposit division should have basked in the glory. Moreover, product fees should have been robust with its institutional division providing cash management services and assisting governments and municipalities.

Alliant Credit Union High-Rate Savings

APY: 0.55%
Min. Balance Required: $100
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
Learn More

Alliant Credit Union’s High-Rate Savings Account has a 0.55% APY, and the minimum balance to maintain your account is $5. However, please note that you must maintain a $100 minimum daily average to qualify for interest payments. As a result, we referenced the $100 minimum in our table since it’s more relevant to potential savers. On the flip side, there are no maximum balance limits, and account fees are waived if you opt for e-statements. For context, paper statements cost $1. However, you can sleep safely knowing that your deposits are FDIC-insured up to $250,000 per person, per account.

Also noteworthy, Alliant Credit Union’s High-Rate Savings Account is one of the few out there that have ATM withdrawal capabilities. For example, if you don’t have an Alliant checking account, the credit union will issue an EMV chip card (which helps protect you from fraud) to make ATM withdrawals. However, please consider that the savings ATM card can only process deposits, withdrawals, and transfers, and you can’t use it to purchase items in-store or online. Despite that, there is no fee to obtain a savings ATM card, and Alliant Credit Union’s fee disclosures show that replacing a lost card is also free. However, the credit union may charge you $10 if you misplace your card several times.

Also beneficial, Alliant Credit Union has more than 80,000 fee-free ATMs located across the U.S. As a result, there are plenty of options to choose from, and withdrawing money from your savings account won’t cost you a dime. However, Alliant Credit Union does note that withdrawals from third-party ATMs may incur a surcharge, though it doesn’t list the exact cost. In any event, comparable out-of-network ATM fees are roughly $2.50 to $3.50 per transaction.

Finally, with Alliant Credit Union and Suze Orman’s The Ultimate Opportunity Savings Account promotion offering a $100 bonus for new clients, it’s one of the best deals out there. For example, the $100 is yours if you deposit $100 in your savings account each month for the next 12 months. In total, this works out to a $100 bonus on a $1,200 deposit. And with a bonus yield of 8.33%, the reward is much higher than the interest rate offered by online and traditional banks.

Pros:

  • Alliant Credit Union has a competitive APY, and there are no account fees if you opt for online statements.
  • You can obtain a free ATM card and make free withdrawals at more than 80,000 locations.

Cons:

  • The firm doesn’t have any branches or physical locations.

Who is the account best suited for?

  • Alliant Credit Union is a solid option if you value the ability to make ATM withdrawals from your savings account.
  • Its mobile app allows you to monitor your savings account and execute transactions 24/7.

The impact of COVID-19:

As a digital-only institution, Alliant Credit Union was a pandemic beneficiary. With in-person banking substituted mainly for the online experience, Alliant Credit Union’s digital infrastructure was up to the task. As a result, clients were able to manage their accounts without disruption.

Comenity Direct High-Yield Savings

APY: 0.55%
Min. Balance Required: $100
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
Learn More

As another solid choice, a Comenity Direct High-Yield Savings Account offers the fourth-highest APY on our list and requires a minimum balance of $100. Moreover, deposits are FDIC-insured up to $250,000 per person, per account. In addition, you avoid monthly maintenance fees, and ACH transfers, incoming wire transfers, and online statements are also free. Likewise, you have unlimited access to free mobile check deposits. However, there is a $25 fee for outgoing wire transfers and a $5 fee if you opt for paper account statements.

In addition, you can manage your Comenity Direct High-Yield Savings Account by downloading its Apple and Andriod apps. You can also make deposits, withdrawals and contact a customer care representative there. And currently, there are no fees to use mobile banking.

However, Comenity Direct offers high-yield savings accounts and CDs, unlike other online banks. For context, the minimum balance for a CD is $1,500, and Comenity Direct’s APYs range from 0,65% (1-year CD) to 1.10% (5-year CD). However, please note that early withdrawal penalties apply: for CDs with maturities that range from one year to three years, the early withdrawal penalty is 180 days worth of simple interest. Similarly, for CDs with maturities of four and five years, the early withdrawal penalty is 365 days worth of simple interest. However, there are no monthly maintenance fees.

Also, if you’re considering a CD, remember that your investment automatically rolls over after it matures. For context, this means that Comenity Direct (and nearly all CD providers) will reinvest your funds once again for the identical duration. However, the APY may not be exact. For example, if the Fed lowers interest rates, the CD’s APY may follow suit. Thus, it’s essential to monitor your maturity date.

Despite that, Comenity Direct notifies you “days in advance” before your CD matures. And after the maturity date has arrived, you have ten calendar days to withdraw your money without incurring a penalty.

Pros:

  • Comenity Direct offers a competitive APY and has been in business since 1986.
  • More than 50 million customers trust the firm’s credit card services.

Cons:

  • The firm doesn’t have any branches or physical locations.

Who is the account best suited for?

  • Comenity Direct offers the security and reliability similar to traditional banks.
  • The firm’s best-in-class customer service may be worth settling for a lower APY.

The impact of COVID-19:

Like the other savings accounts on our list, the Fed’s reduction of interest rates in early 2020 placed downward pressure on Comenity Direct’s APY.

Pentagon Federal Premium Online Savings

APY: 0.55%
Min. Balance Required: $5
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
Learn More

As another solid option, a Pentagon Federal Premium Online Savings Account also has the fourth-highest APY on our list. However, since Pentagon Federal is a credit union, deposits are insured by the National Credit Union Administration (NCUA). Since the NCUA is also a branch of the U.S. federal government, its services are nearly identical to the FDIC. Moreover, deposits are insured up to $250,000 per person, per account. For context, Pentagon Federal’s dividends are paid monthly, and there are no monthly maintenance fees, and online transfers are also free of charge.

In addition, Pentagon Federal’s Money Market Certificates should be on your radar. For context, they’re nearly identical to CDs: they require you to lock in your funds for a specified period, and early withdrawal penalties apply. However, Pentagon Federal’s 1-year MMC has a 0.85% APY, and its 15-month MMC has a 1.00% APY. As a result, the interest rates are attractive if you’re comfortable locking in your funds for these durations. As for early withdrawal fees, the penalties are steep. For example, withdrawing your money within the first year results in the forfeiture of 365 days of dividends. And after one year, the penalty is 30% of potential gross dividends had the MMC reached maturity.

Also, given that the Fed is poised to raise interest rates in 2022 (officials’ latest median projection is for three rate hikes), it’s likely unwise to make any long-term commitments. Instead, a more prudent strategy is to stick with savings accounts with variable APYs (which should increase if the Fed raises interest rates) and consider a CD or MMC in 2023.

Pros:

  • Pentagon Federal offers a competitive APY, and the credit union has roughly 50 branches in 13 states.

Cons:

  • You can’t withdraw funds from your Pentagon Federal Premium Online Savings Account at an ATM.

Who is the account best suited for?

  • Pentagon Federal allows you to bank in person and speak face-to-face with a representative.
  • If onsite communication is valuable to you, Pentagon Federal is there to answer all of your financial questions.

The impact of COVID-19:

While the coronavirus pandemic impacted some Pentagon Federal branches, its mobile app helped clients navigate the uncertainty. In addition, the credit union offered forbearance options that helped ease the burden. However, like the other accounts on our list, Pentagon Federal’s APY was also impacted by the Fed’s monetary policy.

Quontic Bank High Yield Savings

APY: 0.55%
Min. Balance Required: $100
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
Learn More

A Quontic Bank High Yield Savings Account is the perfect no-hassle way to invest your short-term savings. For example, the 0.55% APY is near the high-end of the range, and the no-fee savings account integrates with Apple Pay, Google Pay, and other digital wallets. However, there is a $100 minimum deposit requirement, and dormant accounts are charged $5 per month for inactivity. Despite that, all of your deposits at Quontic Bank are FDIC-insured up to $250,000 per person, per account.

In addition, Quontic Bank is a solid digital solution for your day-to-day banking needs. For example, the group’s fee disclosures show that bank checks and money orders are free of charge, and there are no overdraft fees. However, there is a stop payment fee of $20. Despite that, Chase Bank charges $8.00 for bank checks, $5.00 for money orders, $34.00 for overdraft charges, and $30.00 for stop payments. Likewise, Citizens Bank charges $10.00 for bank checks, $5.00 for money orders, $37.00 for overdraft charges, and $35.00 for stop payments. As a result, Quontic Bank can save you money on banking fees if you’re comfortable doing all of your transactions online.

In addition, if you’re a Bitcoin enthusiast, Quontic Bank has a Rewards Checking Account that offers 1.5% cash-back in Bitcoin on qualifying debit purchases. However, ATM transactions, transfers, loan payments, and peer-to-peer payments don’t qualify for rewards. In addition, purchases made through third-party payment services — like PayPal and Venmo — don’t qualify for cash-back. For context, Quontic Bank’s Bitcoin Rewards Checking Account is available in more than 40 states. However, you should double-check to determine if the account is accessible in your region.

Also noteworthy, you can apply for FHA loans, VA loans, mortgages, and reverse mortgages at Quontic Bank. Likewise, the institution’s blog has a wealth of information to make the home-buying process a lot easier.

Pros:

  • Quontic Bank’s APY compounds daily, and you can open an account in as little as three minutes.

Cons:

  • The firm doesn’t have any branches or physical locations.

Who is the account best suited for?

  • Quontic Bank provides loans to low-income families, immigrants, and other marginalized individuals.
  • If you’re passionate about the cause, a Quontic Bank High Yield Savings Account may be right for you.

The impact of COVID-19:

As another digital bank aiming to make its mark in the U.S., COVID-19 helped Quontic Bank reach a larger audience. Moreover, as a company with a predominantly remote workforce, the pandemic did little to disrupt its operations. However, like the other accounts on our list, Quontic Bank’s APY was impacted by the Fed’s monetary policy.

CIBC Agility Online Savings

APY: 0.52%
Min. Balance Required: $1,000
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
Learn More

While CIBC Bank offers a solid 0.52% APY, the deposit minimum is $1,000. As a result, the option is less attractive for individuals with low savings balances. Conversely, there are no monthly maintenance fees, and CIBC’s mobile banking app can handle all of your day-to-day transactions. Furthermore, your deposits are FDIC-insured up to $250,000 per person, per account.

Also, CIBC Bank’s fee disclosures show that a $25 charge will apply if you close the account within the first 90 days. Likewise, dormant accounts are charged $5 per month and up to $60 per year, while withdrawals can take three days or less to process. In addition, CIBC Bank offers in-person service in 4 states — Illinois, Michigan, Missouri, and Wisconsin. Thus, if you live in these regions and value the ability to speak face-to-face with a representative, a CIBC Agility Online Savings Account is a solid choice.

All in all, the account’s validity depends on your ability to meet the minimum deposit requirement. On the other hand, if the cash is available and you want the security and reliability inherent with traditional institutions, CIBC Bank should fulfill all of your needs. Also, the group’s mobile app provides the convenience of managing your accounts according to your lifestyle. As a result, CIBC Bank is an excellent hybrid between the old school and the new school of banking.

Pros:

  • CIBC Bank’s Agility Online Savings Account has a competitive APY, and there are no monthly account fees.

Cons:

  • You need at least $1,000 to open an account.

Who is the account best suited for?

  • If you’re in Illinois, Michigan, Missouri, or Wisconsin, the ability to bank in-person may be attractive.
  • CIBC Bank offers the security and peace of mind that you expect with traditional banks.

The impact of COVID-19:

While CIBC is a significant player in the Canadian market, its footprint in the U.S. is much smaller. As a result, its Agility Online Savings Account aims to lure customers away from the most prominent competitors. And with plenty of pandemic stimulus still out there, CIBC must feel that now is the right time to proposition new prospects.

Vio Bank High Yield Online Savings

APY: 0.51%
Min. Balance Required: $100
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
Learn More

Offering a competitive APY of 0.51% and a reasonable minimum balance requirement of $100, you can’t go wrong with a Vio Bank High Yield Online Savings Account. In addition, monthly account fees are non-existent. However, if you opt for paper account statements, a $5 fee will apply. Also, if you exceed the U.S. federal limit of six transfers/withdrawals per month, a $10 fee will apply. Despite that, your Vio Bank High Yield Online Savings Account is FDIC-insured up to $250,000 per person, per account.

In addition, as the online division of MidFirst Bank, Vio Bank combines the security of a traditional bank with the higher interest rates of an online bank. However, please note that the firm doesn’t offer a checking account. And since you can’t withdraw your money from an ATM, it’s prudent to allocate capital that you won’t need at a moment’s notice. In addition, Vio Bank doesn’t allow cash deposits, and check deposits max out at $100,000 per day and $250,000 monthly.

As for CDs, Vio Bank offers APYs of 0.15%, 0.30%, and 0.50% for 1-year, 3-year, and 5-year durations. In addition, the deposit minimum is relatively low, at $500. However, your investment automatically rolls over after it matures, and if you don’t want to renew, you need to contact Vio Bank within ten days from when the CD matures. Moreover, as mentioned above, with the Fed poised to raise interest rates in the coming month, investing in products with fixed APYs is less attractive. In contrast, high-yield savings accounts have variable APYs. As a result, the higher the Fed’s overnight lending rate, the higher savings account interest rates will likely head.

Pros:

  • Vio Bank’s APY is near the high-end in the marketplace, and the firm is the online division of MidFirst Bank.

Cons:

  • It costs money to obtain paper account statements.

Who is the account best suited for?

  • Vio Bank is a solid option, though it doesn’t stand out from the crowd.
  • If you’re in Oklahoma City, Tulsa, western Oklahoma, Denver, Phoenix, or Dallas, you can find in-person help.

The impact of COVID-19:

Similar to the interest rate gyrations that other institutions on our list endured, Vio Bank’s APY usually fluctuates with the Fed’s monetary policy.

Varo Bank Online Savings

APY: 0.50%
Min. Balance Required: $0
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
Learn More

While Varo Bank’s Online Savings Account only has a 0.50% APY, the Fintech company offers savers the chance to earn 3%. As a result, it’s the most attractive option for Americans that can meet the minimum requirements:

  1. Initiate $1,000 worth of direct deposits during each qualifying period.
  2. Maintain a savings balance of $5,000 or more per month.
  3. Ensure that your Varo banking and checking accounts are at or above $0.00 per month.

Thus, while there are no fees or minimum balance requirements to earn the 0.50% APY, adhering to the three rules above allows you to generate a 3% APY. And if you already meet these requirements at your current institution, your savings could be earning a lot more interest at Varo Bank. Furthermore, all of your deposits are FDIC-insured up to $250,000 per person, per account.

On top of that, Varo Bank does not conduct a credit check, and day-to-day banking is a breeze. For example, there are no overdraft fees, foreign transaction fees, transfer fees, or monthly account fees. In addition, there are no fees to close your account.

However, please note that out-of-network ATM withdrawals incur a service fee of $2.50 or more per transaction. And since Varo Bank’s Online Savings Account doesn’t allow ATM withdrawals, you need to transfer funds from your savings account to your bank account before you can facilitate the transaction. Despite that, withdrawals made at Allpoint ATM (Varo Bank’s partner service provider) don’t incur any fees. Moreover, with 55,000+ Allpoint ATMs located inside retailers like Target, Rite Aid, Walgreens, and Kroger, ATM fees won’t be a problem if you frequent these locations.

Also, please note that Green Dot Bank helps facilitate consumers’ Varo Bank deposits at more than 90,000 retail locations in the U.S. With the service, you can deposit cash and checks. However, retail service fees can cost you up to $5.95 per transaction.

Pros:

  • The best-in-class deal offers the opportunity to earn a 3% APY.
  • The firm doesn’t list a deposit maximum, so you’re able to generate a high rate on savings of more than $5,000.
  • You can achieve up to 15% cash-back on items purchased with your Varo Bank Visa debit card.

Cons:

  • The firm doesn’t have any branches or physical locations.
  • You need to earn $5 in cash-back rewards before receiving the payment.

Who is the account best suited for?

  • Varo Bank is an excellent option if you have a large savings account and make regular direct deposits.
  • It’s worth the switch if you’re comfortable with mobile-only banking.

The impact of COVID-19:

Like GO2bank, Varo Bank is another pandemic winner. With digital disruption helping keep the American economy moving during the COVID-19 shutdowns, Varo Bank hopes that consumers will maintain their affection when the pandemic subsides.

Marcus by Goldman Sachs Online Savings

APY: 0.50%
Min. Balance Required: $0
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
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With features nearly identical to a Synchrony High Yield Savings Account, a Marcus by Goldman Sachs Online Savings Account has a 0.50% APY, and there is no minimum balance requirement. Moreover, there are no account fees, and deposits are FDIC-insured up to $250,000 per person, per account. In addition, you can download the Marcus app through the Apple App Store or Google Play, and customer service is at your fingertips seven days a week. Moreover, Marcus’ Insight tools can help you track your savings and spending and ensure that you meet your financial goals.

In addition, Marcus by Goldman Sachs offers a wide range of products — including personal loans, credit cards, business lines of credit, and wealth management solutions. And with the group’s personal loans free from sign-up, prepayment, and late fees, they’re a much better option than swiping your credit card. For example, Marcus by Goldman Sachs offers personal loans that range from $3,500 to $40,000, with terms that range from 36 to 72 months. And the group’s APRs range from 6.99% to 19.99%, depending on your creditworthiness. As a result, with the average credit card interest rate in the U.S. ranging from 16.22% to 23.94%, consulting with Marcus by Goldman Sachs is a solid credit decision.

To that point, if you make your total loan payments for 12 consecutive months, you qualify for one month of no payments with zero interest. In a nutshell: the monthly holiday allows you to extend the duration of a personal loan for one month. In addition, if you enroll in “AutoPay & Save,” it reduces your APR by 0.25%. For context, the setup automatically withdraws your monthly loan payments from your checking accounts.

However, if you choose to schedule payments yourself, you don’t have to worry about late payment fees. For context, while late fees are non-existent, missed payments will incur more interest over time. In addition, the delinquency can hurt your credit score, and the missed payments will likely show up on your credit profile. As a result, it’s prudent to stay on top of your loan payments.

Pros:

  • Marcus by Goldman Sachs offers a competitive APY.
  • Its referral bonus allows both you and the recipient to earn a 1% APY for three months.

Cons:

  • The firm doesn’t have any branches or physical locations.

Who is the account best suited for?

  • Marcus by Goldman Sachs is an excellent option if you want a wide range of services.

The impact of COVID-19:

As a subsidiary of Goldman Sachs Bank, the latter benefited materially from COVID-19. With investment banking and capital markets activity booming during the pandemic, the group could do what it does best. However, the Fed will likely have to move the needle for savers to realize any benefits.

Synchrony High Yield Savings

APY: 0.50%
Min. Balance Required: $0
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
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As another attractive savings option, a Synchrony High Yield Savings Account has a 0.50% APY, and you get to skip the minimum balance requirements and the monthly fees.

To make an initial deposit or execute a withdrawal, you have plenty of options to choose from:

  • First, you can create an internal transfer from another Synchrony Bank Account.
  • Second, you can transfer funds from an external account using an electronic funds transfer (EFT).
  • Third, you can use Synchrony’s mobile check deposit service and add funds using your smartphone or tablet.
  • Fourth, you can set up a direct deposit.
  • Fifth, you can initiate a wire transfer.
  • Finally, you can mail Synchrony a personal check.

What’s more, interest at Synchrony is compounded daily and credited to your account monthly. The bank also reimburses ATM fees up to $5 per statement cycle as a side benefit. On its own, Synchrony does not charge any ATM fees. However, fees charged by external ATM owners/operators qualify for reimbursement. Also essential, your Synchrony High Yield Savings Account is FDIC-insured up to $250,000 per person, per account.

On top of that, Synchrony’s credit card portfolio is quite compelling. For example, Synchrony’s Premier Mastercard has no annual fee, and you earn 2% cash-back on all purchases. And with its relationship with Mastercard, you can qualify for identity theft protection and access a monthly risk newsletter. For context, purchase APRs vary from 13.99% to 26.99% — which is in line with the U.S. national average. As well, if you would like to see how Synchrony stacks up against the competition, please see our latest study.

Pros:

  • Synchrony offers an optional ATM card that lets you access your funds whenever you want.

Cons:

  • The firm doesn’t have any branches or physical locations.

Who is the account best suited for?

  • ATM accessibility creates a hybrid checking/savings account that keeps you controlling your money.
  • Many institutions don’t offer this option.

The impact of COVID-19:

Running the race to gain new clients, Synchrony enhanced its notoriety during the pandemic. However, with an APY that doesn’t necessarily stand out from the crowd, Synchrony may have to increase its promotions in 2022 to maintain the momentum.

Barclays Online Savings

APY: 0.50%
Min. Balance Required: $0
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
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Barclays is a well-known financial institution, as a global bank with offices worldwide. And its Online Savings Account offers clients a 0.50% APY, with no monthly maintenance fees and no minimum or maximum balance limits. In addition, your deposits are FDIC-insured up to $250,000 per person, per account.

Also beneficial, you can transfer your funds to and from Barclays by linking an external bank account. For context, the bank uses test deposits to ensure that everything runs smoothly. It works like this: Barclays will make two deposits (with its own money) of up to $0.99 in your external account. And once you verify that the amounts match Barclays’ record, you can transfer money freely between institutions. However, please note that the federal limit of six withdrawals per month still applies. Despite that, Barclays doesn’t list any fees to execute the transactions, and since some institutions charge for outgoing transfers, it’s a bonus. However, it often takes two to three business days for the funds to reach your external account.

On the flip side, Barclays offers a full suite of online CDs. However, the APYs are lower than comparable offers, though any deposit qualifies as there are no minimum balance requirements. Despite that, early withdrawal penalties apply. For example, Barclays’ fee disclosures show early withdrawal on CDs with terms of 24-months or fewer results in the forfeiture of 90 days simple interest on the amount withdrawn. Similarly, for CDs with terms of more than 24-months, you’re charged 180 days simple interest on the amount withdrawn. Also, Barclays’ CDs automatically roll over at maturity. However, you have 14 calendar days — starting on the maturity date — where you can remove your funds without penalty.

Pros:

  • Barclays offers a competitive APY, and there are no fees or minimum balance requirements.

Cons:

  • The firm doesn’t have any branches or physical locations in the U.S.

Who is the account best suited for?

  • A Barclays Online Savings Account is a great option if you want to move money to and from other institutions.
  • Barclays is a global bank that offers the reliability and security of a well-known brand.

The impact of COVID-19:

Due to its large footprint in the investment banking industry, Barclays enjoyed the deal-making frenzy that erupted during the coronavirus pandemic. However, savers weren’t as lucky, as lower interest rates from the Fed put downward pressure on high-yield APYs.

Ally Online Savings

APY: 0.50%
Min. Balance Required: $0
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
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With a 0.50% APY and no balance minimums or fees, you can’t go wrong with an Ally Online Savings Account. To that point, your deposits are FDIC-insured up to $250,000 per person, per account.

However, what separates Ally Bank from the competition is its digital dividers. Coined “buckets,” an Ally Online Savings Account allows you to organize your money by up to 10 different goals. It works likes: say you’re saving for a vacation, a down payment on a new home, or looking to optimize your rainy-day fund, you can track each goal’s progress individually. That way, you can monitor which milestones are close to achievement and which ones require more work. Likewise, Ally Bank provides you with recommendations for your buckets. However, you can also personalize them by what matters most to you. As a result, an Ally Online Savings Account adds a sentimental touch that isn’t always present with comparable offers.

To that point, Ally Bank’s “boosters” are also practical tools to enhance your savings progress. For example, if your checking account is with Ally Bank, you can round up your purchases to the nearest dollar. And once you accrue $5, it’s automatically deposited in your savings account. Likewise, its automated Surprise Savings feature can sift through your checking account and find unused funds that would be better suited earning interest in your savings account. And once spotted, Ally Bank’s algorithm facilitates the transaction.

However, please note that if you exceed the federal limit of six withdrawals per month, Ally Bank charges $10 for every withdrawal after that. In addition, Ally Bank’s fee discloses show that outgoing wire transfers cost $20 per transaction. However, if you link an external bank account, Ally Bank won’t charge any fees to move your money back and forth. Also, you can use your computer or mobile device to deposit checks into your Ally Online Savings Account free of charge.

Pros:

  • Ally Bank offers a competitive APY and charges zero monthly fees.
  • Ally Bank’s buckets and boosters help personalize the savings process.

Cons:

  • The firm doesn’t have any branches or physical locations.

Who is the account best suited for?

  • If you value organization and a detailed breakdown of your finances, Ally Bank may be right for you.
  • Ally Bank’s algorithm can take the guesswork out of saving and help you make smarter money decisions.

The impact of COVID-19:

As another online-only institution, Ally Bank was another pandemic winner. Moreover, with its Ally Invest self-directed brokerage service also popular among do-it-yourself (DIY) investors, the digital revolution has been kind to Ally Bank.

American Express High Yield Savings

APY: 0.50%
Min. Balance Required: $0
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
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American Express’ High Yield Savings Account also deserves some notoriety, and the institution is well-known for its robust credit card portfolio. With a competitive APY of 0.50% and no fees or minimums, the account is among the best in the business. Moreover, your deposits are FDIC-insured up to $250,000 per person, per account.

And unlike comparable offers, American Express allows 9 withdrawals per month instead of six. For context, the Fed revised the rule in April 2020 to ease Americans’ financial burden during the pandemic. However, many institutions still apply the law as it was, and the Fed will likely formally reinstate the rule at some point. However, in the meantime, American Express allows three more withdrawals per month than many of its competitors. In addition, American Express will enable you to link an external bank account to transfer money to and from other financial institutions. And like Barclays, American Express uses test deposits to determine the safety and reliability of the linked account. Moreover, the firm doesn’t list any fees to execute the transactions.

Also noteworthy, American Express doesn’t list any fees for paper statements. As a result, if you prefer a hard copy instead of sifting through online documents, you can have your account statement mailed to you. However, please note that debit cards, checks, and ATM withdrawals are not provided or permissible.

Pros:

  • American Express’ High Yield Savings Account has a competitive APY and no minimum balance requirements.
  • Americans Express allows nine withdrawals per month, which is more than the standard six.

Cons:

  • The firm doesn’t have any branches or physical locations.

Who is the account best suited for?

  • American Express credit card holders that value customer service may find its High Yield Savings Account attractive.

The impact of COVID-19:

While a decline in credit card usage during the pandemic may have impacted American Expresses’ card business, deposit accounts demonstrated the opposite trend. And while American Express doesn’t offer the highest APY on our list, its savings account should have benefited from the robust increase in the U.S. money supply.

Live Oak Personal Savings

APY: 0.50%
Min. Balance Required: $0
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
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As another digital bank helping savers make the most of their money, a Live Oak Personal Savings Account has a 0.50% APY, and you don’t have to worry about minimum balance requirements or monthly maintenance fees. In addition, your deposits are FDIC-insured up to $250,000 per person, per account.

However, please note that if you exceed the federal limit of six withdrawals per month, a $10 charge per transaction will apply. Moreover, if your Personal Savings Account has less than $10.01 and there is no activity for 24-straight months, Live Oak will charge you a $10 dormant account fee or deduct whatever amount is left in the account — whichever is less. However, it’s easy to avoid the fee. For example, simply logging into your account one time within 24-months qualifies as an acceptable activity.

Also noteworthy, Live Oak is a digital bank that specializes in small business loans and accounts. So if you’re a small business owner and find value in banking under one roof, Live Oak is a solid choice. In addition, the bank’s resource center has plenty of helpful tips to make your personal and business finances work for you. Moreover, you’ll find articles on everything from SBA loans to helping your business thrive on social media. As a result, there is plenty to like about Live Oak Bank.

Pros:

  • Live Oak has a solid APY, and monthly maintenance fees won’t drag down your returns.
  • You can monitor your savings account 24/7 by downloading the Live Oak app for Apple and Android.

Cons:

  • The firm doesn’t have any branches or physical locations.

Who is the account best suited for?

  • If you want to manage your personal and business accounts with the same bank, Live Oak fits the bill.

The impact of COVID-19:

While ‘big business’ thrived throughout the coronavirus pandemic, lockdowns disproportionately affected small businesses. And offering more than just savings accounts, Live Oak was there to lend a helping hand.

TIAA Bank Basic Savings

APY: 0.50%
Min. Balance Required: $25
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
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There are more positives than negatives with a TIAA Bank Basic Savings Account. For example, you earn a competitive APY of 0.50%, and the minimum deposit is $25. In addition, your deposits are FDIC-insured up to $250,000 per person, per account.

On top of that, TIAA Bank’s fee disclosures show that there are no fees for the most critical transactions. Thus, whether it’s non-sufficient funds (NSF), ATM fees, bill payments, or a lost card, you don’t have to worry about out-of-pocket expenses. To that point, TIAA Bank will also reimburse you $15 per month for ATM fees incurred at third-party locations. Moreover, if your average daily account balance exceeds $5,000, there is no limit to the amount of third-party ATM reimbursements. However, while the linked document lists the terms for a TIAA Bank Basic Savings Account, conventional wisdom implies that it must reference a TIAA Basic Checking Account. For example, the fee schedule is nearly identical, and TIAA Bank only mentions a Visa Debit Card. As a result, while transferring your money between checking and savings accounts should be easy, the former is likely required to make bill payments and ATM withdrawals.

Also noteworthy, TIAA Bank offers in-person customer service at 9 U.S. branches. However, all of them are in Florida. Thus, if you value arm’s length customer service, a TIAA Bank Basic Savings Account may be the most attractive option for residents of the Sunshine State. On the flip side, TIAA Bank also offers wealth management solutions. And if you’re looking for investment advice that goes beyond savings accounts, the firm has 146 office locations across the United States.

Pros:

  • TIAA Bank’s Basic Savings Account has a competitive APY.
  • TIAA Bank’s Basic Checking Account has lower fees than comparable offers.

Cons:

  • The $25 deposit minimum is higher than comparable offers.
  • TIAA Bank only has nine branches and they’re all in Florida.

Who is the account best suited for?

  • For Florida residents, TIAA Bank offers the perfect combination of a high savings APY and in-person service.
  • Combining your savings account with a TIAA Basic Checking Account increases efficiency.

The impact of COVID-19:

While its savings accounts were less affected, TIAA Bank’s wealth management division likely thrived throughout the pandemic. With stock markets hitting all-time highs and management fees likely following suit, TIAA Bank was among the pandemic winners.

Citibank Accelerate High-Yield Savings

APY: 0.50%
Min. Balance Required: $500
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
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As a name you know and trust, Citibank is one of the largest financial institutions in the U.S. Moreover, its Accelerate High-Yield Savings Account offers a 0.50% APY and your deposits are FDIC-insured up to $250,000 per person, per account. However, it’s only an attractive option if you meet the minimum requirements. For example, there is no minimum deposit. But if your account falls below $500, you’re charged a monthly fee of $4.50. And for that reason, we referenced $500 as the minimum requirement in our table above.

In addition, Citibank’s Accelerate High-Yield Savings Account is available in 43 states. As a result, it’s essential to check your zip code before you get too excited. On the flip side, Citibank has branches across the United States, and 65,000 fee-free ATMs are at your disposal. Thus, if you have a checking account with Citibank and can maintain a $500 balance, you should find the option suitable. Likewise, Citibank offers the security and reliability of a traditional bank. And unlike many of the other institutions on our list, Citibank is a significant player across several areas of the financial sector. But conversely, status doesn’t always pay. And with some of the institutions on our list offering higher APYs and lower account minimums with the same FDIC protection, a lesser-known institution may be more appropriate.

Pros:

  • A Citibank Accelerate High-Yield Savings Account has a solid APY.
  • Citibank has access to products and services that other institutions don’t.

Cons:

  • The $500 minimum to avoid fees is much higher than comparable offers.
  • Citibank’s Accelerate High-Yield Savings Account is only available in 43 states.

Who is the account best suited for?

  • If you value the ability to visit a bank branch, Citibank could be right for you.
  • Citibank’s vast ATM network and bevy of other services supports banking across multiple accounts.

The impact of COVID-19:

As a titan of Wall Street, Citibank’s investment banking division thrived during the pandemic. And outside of Goldman Sachs and Barclays, Citibank is the only ‘big bank’ on our list that offers a high-yield savings account. As a result, Citibank is willing to pay more than most of its peers to win new clients.

Chime High-Yield Savings

APY: 0.50%
Min. Balance Required: $0
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
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You can say goodbye to fees and minimum balance stipulations with a Chime High-Yield Savings Account. Moreover, the account has a competitive APY of 0.50%. If you open a checking account, too, you can round all of your purchases to the nearest dollar and automatically deposit the excess into your savings account. And, of course, your deposits are FDIC-insured up to $250,000 per person, per account.

Chime is a financial technology company that offers checking, savings, and credit builder accounts if you’re unfamiliar. Also valuable, Chime’s Credit Builder Secured Visa Credit Card helps repair your credit profile. To that point, Chime reports your payback habits to Equifax, Experian, and TransUnion, and on average, cardholders increase their credit scores by 30 points. Moreover, there is no annual fee or credit check. Also noteworthy, Chime’s referral program pays both parties to join the platform by offering a $100 cash reward or gift card. To qualify, the recipient needs to make a $200 direct deposit within 45 days of the account opening. However, it works out to a $200 total bonus on a $200 total deposit. And with 24/7 customer service available through phone, email, and chat., there is plenty to like about Chime.

However, please note that Chime is a Fintech firm, and you need to be comfortable with mobile banking. Moreover, there are no branches or in-person services. Thus, it would be best to consider these limitations before making your final decision.

Pros:

  • A Chime High-Yield Savings Account has a solid APY and you don’t have to worry about fees.
  • You can rebuild your credit with a Chime Secured Visa Card.

Cons:

  • The firm doesn’t have any branches or physical locations.

Who is the account best suited for?

  • If you’re comfortable with mobile-only banking, Chime may be right for you.

The impact of COVID-19:

With stay-at-home orders in 2020 offering Fintech platforms a chance to shine, companies like Chime benefited from our remote living amid the pandemic. Moreover, Fintech companies hope to continue this momentum in 2022 by offering high-yield savings accounts and referral bonuses to help win new clients.

Discover Online Savings

APY: 0.50%
Min. Balance Required: $0
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
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A Discover Online Savings Account has a 0.50% APY, and there are no fees or minimum deposit requirements. Thus, whether you need a bank check or you want to close your account, you won’t incur any out-of-pocket expenses. Moreover, Discover’s mobile app allows you to deposit checks directly into your savings account electronically. And customer support is available 24/7. However, unlike Citibank, Discover doesn’t have any branches. As a result, it isn’t possible to speak with a representative in person. Despite that, a Discover Online Savings Account is a solid place to invest your short-term savings.

Moreover, the bank has a solid slate of credit cards with no annual fees and APRs that range from 11.99% to 22.99%. In addition, Discover offers personal loans that range from $2,500 to $35,000 with APRs that range from 5.99% to 24.99%. As a result, Discover is home to a plethora of financial products with highly competitive terms.

In addition, Discover offers a $150 welcome bonus if you deposit $15,000 in a Discover Online Savings Account. And you can receive a $200 welcome bonus if you deposit $25,000. However, the bonus yield (1%) is higher if you opt for the first option. Furthermore, it’s comforting to know that all of your deposits are FDIC-insured up to $250,000 per person, per account.

Pros:

  • With no account fees and a 0.50% APY, Discover is a solid place to invest your money.
  • Discover’s bonus offer is one of the best in the marketplace.

Cons:

  • The firm doesn’t have any branches or physical locations.

Who is the account best suited for?

  • If you’re comfortable managing your savings account online, Discover may be right for you.
  • Discover’s credit cards also have some of the lowest APRs in the industry.

The impact of COVID-19:

Known for its low fees, Discover hopes that its pandemic savings offer will further spread the word. And with a plethora of banking products that help you make the most of your money, consumers should keep Discover on their radars.

First Foundation Bank Online Savings

APY: 0.50%
Min. Balance Required: $1,000
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
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Like CIBC Bank, a First Foundation Bank Online Savings Account has a solid APY of 0.50%, but a $1,000 deposit is required. However, monthly fees are non-existent, and your deposits are FDIC-insured up to $250,000 per person, per account.

Conversely, First Foundation Bank fee disclosures show that the institution charges $20 for excess withdrawals that exceed the federal limit of six per month. In addition, if you close the account within the first 90 days, a $20 charge applies. Similarly, it will cost you $5 to execute a telephone or email transfer. However, online transfers don’t incur any charges. Likewise, opting for paper statements will cost you $6.

On the flip side, there is plenty to like about First Foundation Bank. For example, the institution has 20 branches spread across Southern California, Northern California, Hawaii, and Nevada. Thus, if you live in these regions, the ability to speak with a representative in person is a bonus. Moreover, most institutions don’t allow you to withdraw money from savings accounts at ATMs. For context, Axos Bank, Synchrony, and Alliant Credit Union provide savers with this option. And First Foundation Bank also provides optional ATM cards upon request. However, please note that ATMs may not be available in all areas and are mainly for residents of the regions listed above. Also, if you lose your ATM card, it costs $5 for a replacement.

Pros:

  • A First Foundation Bank Online Savings Account has a solid APY, and there are no monthly account fees.
  • You can obtain a free ATM card by contacting a representative.

Cons:

  • You need at least $1,000 to open an account.

Who is the account best suited for?

  • If you live in Southern California, Northern California, Hawaii, or Nevada, First Foundation Bank may fit your needs.
  • First Foundation Bank is a solid option if you value the ability to make ATM withdrawals.

The impact of COVID-19:

As a regional bank that specializes in consumer and business banking, First Foundation Bank doesn’t have a Wall Street pedigree like Goldman Sachs, Citibank, Barclays, and to a lesser extent, CIBC Bank. However, the institution’s wealth management division should have prospered as investment inflows increase advisors’ fee incomes.

Popular Direct High-Rise Savings

APY: 0.45%
Min. Balance Required: $5,000
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
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As we approach the end of our study, the final two options are the least attractive high-yield saving accounts on our list. And to make that determination, it boils down to their minimum deposits and APYs. For example, a Popular Direct High-Rise Savings Account has any APY (0.45%) lower than the competition and a minimum deposit requirement ($5,000) higher than the competition. However, there or no monthly service fees, and your deposits are FDIC-insured up to $250,000 per person, per account.

Moreover, Popular Direct’s fee disclosures mention a $25 charge if you close your account within 180 days. In addition, there is a dormant account fee of $5 per month. For context, this fee only applies if the account has been inactive for 12 months. Likewise, if you exceed the federal limit of six monthly withdrawals, Popular Direct will levy a $5 fee.

Also, please note that Popular Direct is a digital bank, and there are no branches or physical locations. In addition, the group doesn’t have an ATM network. However, you can link an external bank account and transfer funds to and from other institutions.

Pros:

  • Popular Direct offers a respectable APY, and there are no monthly account fees.

Cons:

  • You need at least $5,000 to open an account.
  • The firm doesn’t have any branches or physical locations.

Who is the account best suited for?

  • If you have a pre-existing relationship with Popular Direct, you may value banking under one roof.

The impact of COVID-19:

It’s tough to determine the pandemic’s impact on Popular Direct. For example, the firm should have benefited from the unprecedented increase in the money supply. However, since the terms of its savings account are much less competitive than comparable offers, Popular Direct doesn’t seem to be fighting for new business.

Citizens Access Online Savings

APY: 0.40%
Min. Balance Required: $5,000
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
Learn More

Last on the list, a Citizens Access Online Savings Account has a 0.40% APY, and you have to deposit at least $5,000 to open an account. However, there are no monthly service fees, and your deposits are FDIC-insured up to $250,000 per person, per account. Also, please note that Citizens Access does not have any branches or physical locations, and all of your banking occurs online. However, you can link an external bank account to move money seamlessly.

Thus, while a Citizens Access Online Savings Account isn’t at the top of our list, it may be right for you under certain circumstances. To that point, it’s important to remember that Citizens Access is an independent division of Citizens Bank. In a nutshell: the two are under the same umbrella, though they operate as separate entities. However, if you reside in any of the 12 states where Citizens Bank operates, the institution’s physical footprint allows you to speak with a representative in person. Moreover, more than 1,000 branch locations are available in the eastern United States.

Furthermore, while we’re lukewarm on the firm’s savings accounts, Citizens Bank does offer a $300 welcome bonus for opening a checking account and setting up a single direct deposit of at least $500 within 60 days. In addition, you can also receive $2 per qualified debit purchase (up to $100 maximum) within the first 60 days. Moreover, Citizens Bank’s One Deposit Checking Account has a maintenance fee of $9.99 per month. However, you can avoid the charge if you deposit “any amount” per month. As a result, it’s a relatively low bar to overcome. In conclusion, if you’re considering joining Citizens Access or Citizens Bank, we believe that the checking account offers the most value.

Pros:

  • Citizens Bank has a respectable APY, and you don’t have to worry about account fees.

Cons:

  • You need at least $5,000 to open an account.
  • The firm doesn’t have any branches or physical locations.

Who is the account best suited for?

  • If you have a pre-existing relationship with Citizens Bank, you may value banking under one roof.

The impact of COVID-19:

Since the pandemic has increased the money supply, the competition for access to consumers’ wallets has intensified. And since 12 other retail banks have more assets on their balance sheets, Citizens Bank is offering a solid checking account bonus to help attract new clients. Conversely, with Citizens Access sticking to its high deposit minimum, the group seems less inclined to fight for new clients.

Capital One 360 Performance Savings

APY: 0.40%
Min. Balance Required: $0
Monthly Service Fee: $0
FDIC/NCUA Insured: Yes
Learn More

Offering performance that you can count on, a Capital One 360 Performance Savings Account has no fees, requires no minimum balance, and has an APY of 0.40%. Moreover, it’s easy to link your savings account to an external bank account. For context, this allows you to transfer money to and from another institution without incurring any fees. Likewise, you can deposit checks directly into your account using Capital One’s mobile app, and there are Capital One Cafés located in select states. Furthermore, your deposits are FDIC-insured up to $250,000 per person, per account.

However, you should know that you can’t take out money from your 360 Performance Savings Account at an ATM. Instead, you have to transfer the funds from your savings account to your checking account to facilitate the transaction. However, direct transfers/withdrawals made online or at a Capital One Café are permissible. Also noteworthy, Capital One’s fee disclosures show that outgoing wire transfers cost $30. Thus, that’s why it’s so important to link an external account to avoid these unnecessary charges. Likewise, a bank check will cost you $10, and Capital One may request access to your credit report when you open your account. However, Capital One will notify you of the action if the procedure is deemed necessary.

Also, please note that if any errors are present with your 360 Performance Savings Account, the agreement terms require you to notify Capital One within 60 days. Furthermore, you can close your account at any time, and Capital One’s disclosures don’t list any fees to facilitate the request.

Pros:

  • A Capital One 360 Performance Savings Account has a mid-level APY, though you avoid fees and balance minimums.

Cons:

  • In-person service is only available in select states.

Who is the account best suited for?

  • If you live in an area with a Capital One Café, you may find the face-to-face service valuable.
  • If you’re a Capital One credit card holder, banking under one roof may be attractive.

The impact of COVID-19:

Like American Express, the pandemic’s decline in credit card usage may have impacted Capital One’s card business. Similarly, while Capital One doesn’t offer the highest APY on our list, its savings account should have benefited from the robust increase in the U.S. money supply.

What is a High-Yield Savings Account?

High-yield savings accounts are nearly synonymous with traditional savings accounts:

  • Banks and credit unions offer them.
  • They qualify for deposit insurance.
  • They help increase your wealth over time.

In addition, high-yield savings accounts are demand deposit accounts. The term means that you’re free to withdraw your money whenever you want, as long as you don’t exceed the federal limit of six transfers per month. Likewise, high-yield savings accounts have no maturity date, and there are usually few eligibility requirements.

However, since your money is available on-demand, high-yield savings accounts are a great place to invest your emergency funds. For example, high-yield savings accounts offer much higher interest rates than their traditional counterparts. And if you prudently set aside a portion of your paycheck to help cover unforeseen events, your money will accrue more interest along the way. As a result, when the moment arrives and the cash is needed, you have instant access to both your principal and interest.

Also, please note that high-yield savings accounts have variable APYs. For context, this means that the stated interest rate can increase or decrease at any time. Moreover, high-yield APYs often follow the Fed’s overnight lending rate. As a result, when the Fed raises interest rates, high-yield APYs often rise. And when the Fed lowers interest rates, high-yield APYs often fall.

How Do High-Yield Savings Accounts Differ From Checking Accounts and CDs?

With so many options to choose from, it’s challenging to determine which account type is right for you. However, to simplify the search, we want to explain the difference between various accounts.

Checking accounts:

Checking accounts are best for your day-to-day banking needs. For example, making purchases, paying bills, and transferring funds is easy with checking accounts. However, the downside is that checking accounts often have high fees and accrue little or no interest. Also, please note that checking accounts often come with debit cards that allow you to access your funds at ATMs. In contrast, high-yield savings account and CDs usually don’t include this feature.

CDs:

CDs are similar to high-yield savings accounts: they have higher APYs, and they qualify for FDIC and NCUA insurance up to $250,000 per person, per account. However, a significant difference is that CDs have predetermined lockup periods. For example, CDs often have fixed terms of one year, two years, or five years. And during the investment horizon, you can’t withdraw your money without incurring early-withdrawal penalties. As a result, CDs aren’t the best place for your rainy day fund.

Conversely, no-penalty CDs allow you to withdraw your money at any time. However, they usually have lower APYs than CDs with fixed terms. In addition, many no-penalty CDs don’t allow partial withdrawals. As a result, if you’ve invested $5,000 and want to take out $500, the only option is to withdraw all of your money.

Interesting Facts About High-Yield Savings Accounts

For a quick rundown of how high-yield savings accounts can improve your financial well being, please consult our list below:

  • High-yield savings accounts are easy to open, and almost all applicants are approved.
  • High-yield savings accounts have the highest APYs in the marketplace.
  • High-yield savings accounts often have no fees and no deposit minimums.
  • Online banks have the most attractive high-yield savings accounts.
  • High-yield savings accounts allow you to earn the highest return while taking zero risk.
  • The U.S. federal government insures high-yield savings accounts up to $250,000 per person, per account.
  • Accepting promotional offers can help you earn the highest APY.
  • Opening a high-yield savings account won’t affect your credit score.
  • High-yield savings accounts have variable APYs, and interest rates often track the Fed’s overnight lending rate.
  • You usually can’t withdraw the funds in your high-yield savings account at an ATM.

How to Determine Which High-Yield Savings Account is Right For You

To determine the best of the best, we organized high-yield savings accounts by those with the highest APYs. And with so much competition and interest rates near historic lows, every basis point helps your money grow that much faster.

Second, we have to know that our money is secure. That’s why institutions that the FDIC or NCUA insures are the only ones that make it on our list. Think about it: if you have to worry about the possibility of insolvency, it doesn’t matter how high the APY is. Under those circumstances, you’ve gone from zero risk to material risk.

After those two parameters are met, it comes down to personal preference. For example, the mobile-only institutions on our list are Fintech companies, not banks. Thus, your savings are held at their FDIC-insured partner banks and not with the companies themselves. And while this makes no difference in terms of your $250,000 per person, per account, insurance limit, it’s a characteristic that you may find less appealing.

To that point, mobile-only banks don’t offer in-person customer service, and you need a quality smartphone to get started. However, if you’re technologically inclined, these institutions have the highest risk-free APYs in the industry. On the flip side, credit unions and online affiliates of traditional banks incur a slight trade-off. For example, their APYs are often slightly lower than the highest interest rates offered by mobile-only banks. But, on the other hand, their customer service is often a notch above, and you can usually walk into a branch and speak with a representative about any concerns.

As a result, the final decision is subjective. If you’re okay with sacrificing a portion of your APY for human interaction, then a credit union or online affiliate is likely right for you. However, if you want to earn the highest interest rate, a mobile-only bank is your best bet.

What If I Can’t Open an Account?

It’s highly unusual for a bank or Fintech company to deny your application. For example, since you deposit the funds and there is no extension of credit, the institution incurs little or no risk.

However, if you have a credit or security freeze on your credit profile, it may delay or influence the approval process. Likewise, negative items on your credit report can also affect the results. For example, if you have unpaid debts, bounced checks, or suffered several overdraft charges, your banking history can come back to bite you.

However, if you find yourself in this unfortunate situation, consider the following options:

  • Contact the institution directly and explain your circumstances.
  • Obtain a copy of your credit profile and check for errors.
  • Shop around and expand your universe of potential accounts.

All in all, having your application denied is a deflating event. However, it’s not the end of the world. Everyone makes mistakes, and financial institutions themselves are no different. As a result, showing initiative and being persistent in your search should pay off in the end.

High-Yield Savings Accounts and Hidden Fees

Unlike checking accounts, high-yield savings accounts often have no hidden fees. However, there are a few items that you should watch out for:

Excess withdrawal fees:

Remember, high-yield savings accounts limit withdrawals to six per month. As a result, if you exceed the federal-mandated limit, you’re often charged a penalty fee. Because of this, it’s essential to plan. For example, if you have a student loan payment, tax payment, or are planning a weekend getaway, withdraw a higher-than-expected amount from your high-yield savings account to avoid having to double dip later.

ATM fees:

While not all high-yield savings accounts offer this feature, Axos Bank and Synchrony allow you to access your funds at ATMs. However, external ATM operators often charge a fee to compensate for their service. As a result, while institutions have networks with thousands of ATMs, it’s crucial to determine which ones are free and which ones incur third-party fees.

Wire transfer fees:

As a double standard in the financial industry, incoming wire transfers are often free, while outgoing wire transfers incur costs. In a nutshell: banks are eager to help you deposit your money but are less accommodative when you want to leave. As a result, consider linking an external bank account with your high-yield savings account. This way, you can transfer money to and from different institutions, and the process usually doesn’t incur any fees.

Inactivity fees:

This fee shouldn’t apply if you’re in the market for a high-yield savings account. However, if you change your mind or determine that you need all of your cash to cover an unforeseen event, leaving your account dormant can cost you inactivity fees. For context, the charge is usually $20 or so, and most institutions will warn you before proceeding with the process. However, please read the fine print to determine if the grace period is 12 months or less.

Online High-Yield Savings Rates vs. Traditional Bank Savings Rates

If you open traditional brick-and-mortar savings accounts at institutions such as Bank of America, Wells Fargo, or Citibank, you’ll notice their APYs barely keep your money above water.

While the largest U.S. banks offer familiarity and stability, their average savings account interest rates are also near the lowest in the country. For example, nine out of the 11 institutions in our study offer an average savings account interest rate below the national average of 0.06%.

Moreover, Capital One (0.35%) offers the highest average savings account interest rate. In contrast, Wells Fargo, Chase Bank, HSBC, US Bank, SunTrust, and Huntington National (0.01%) offer the lowest average savings account interest rate. Likewise, Capital One is the only traditional bank that provides an average savings account interest rate comparable to online banks.

Institution: Average Savings Account Interest Rate: % Above/Below the National Average:
Capital One 0.35% + 0.29%
Citibank 0.06% + 0.00%
TD Bank 0.03% – 0.03%
Bank of America 0.03% – 0.03%
PNC Bank 0.02% – 0.04%
Wells Fargo 0.01% – 0.05%
Chase Bank 0.01% – 0.05%
HSBC 0.01% – 0.05%
US Bank 0.01% – 0.05%
SunTrust 0.01% – 0.05%
Huntington National 0.01% – 0.05%

And why is there such a significant difference between the savings rates at online and traditional banks?

Well, it all comes down to costs.

Traditional banks incur significant overhead expenses from operating their vast network of branches. Expenses like rent, utilities, labor costs, and insurance. Conversely, online banks run much leaner operations. There are no physical branches, and they operate with minimal staff. As such, these cost savings provide them with more leeway to offer higher interest rates.

Withdrawing Money From a Online High-Yield Savings Account

To ensure compliance with the Fed’s Regulation D guidelines, online high-yield savings accounts limit withdrawals to six per month. These include online withdrawals, telephone transfers, and overdraft protection transfers.

If you exceed the limit of six per month, you often incur excessive withdrawal fees. Moreover, if the behavior continues, the institution reserves the right to close your account.

Keep in mind that there are ways around the limit. By making most of your withdrawals through an ATM or bank teller, you can access your funds while maintaining compliance because these transactions do not count toward your six per month.

Is My Online High-Yield Savings Account Insured?

Absolutely. Nearly all balances held within the accounts listed above are insured up to $250,000 per person, per account by the Federal Deposit Insurance Corporation (FDIC).

And what is the FDIC?

As an independent agency of the U.S. federal government, the FDIC promotes public confidence by guaranteeing deposits if a member institution defaults. The agency also examines and supervises roughly 4,000 banks and savings institutions to ensure operational safety.

And what about the National Credit Union Administration (NCUA)?

Born in 1970, the NCUA is essentially the FDIC for credit unions. For example, it’s an independent U.S. federal agency that Congress created to protect Americans that deposit their money at credit unions. And like the FDIC, deposits are insured up to $250,000 per person, per account.

What to Expect From High-Yield Savings Accounts in 2022

While high-yield APYs have suffered throughout the coronavirus pandemic, there may be light at the end of the tunnel. For example, the Fed’s latest Summary of Economic Projections (SEP) shows that the median participant expects three interest rate hikes in 2022. Moreover, some Fed officials have said that liftoff could occur as soon as their March monetary policy meeting.

As a result, while lower-for-longer interest rates have been the standard for some time, 2022 could be a banner year for savers. As such, if you’re in the market for a high-yield savings account, it’s shaping up to be a good year. Moreover, with many institutions unveiling their savings account promotions during tax time — around March and April — some attractive offers will likely materialize in the coming months. And as always, we’ll stay on top of the latest developments and let you know which promotions are worthy of consideration.

How We Conducted The Study

We analyzed high-interest savings accounts from several online and traditional financial institutions to present the most valuable options. Next, we narrowed our findings to those with the lowest accounts fees. Then, we made sure that all of the institutions reported being insured by the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA).

Conclusion

With U.S. national average savings rates barely above their all-time lows, online banks provide the only avenue to earn a competitive return. For example, online banks have much higher interest rates than traditional banks, and they also include the same FDIC and NCUA protection that provides depositors with peace of mind.

As a result, if you’re looking for short-term investing solutions that make the most out of your money, the online institutions above are a great place to start.

Other Studies You May Enjoy

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Average Savings Account Interest Rates 2022

Average Checking Account Interest Rates 2022

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