Over the past week, average savings account rates have remained unchanged as banks try to figure out how much higher the Federal Reserve will raise interest rates, if at all. The Fed significantly lifted rates from March 2022 in an effort to moderate sky-high inflation, which has resulted in banks raising the interest on deposits over the past year.
This favorable situation for savers offers an excellent chance to strengthen your emergency fund or save for a major purchase. Regardless of your goal, strive to find a savings account that features a competitive interest rate, minimal fees and exceptional customer service, along with a seamless digital user experience.
Known as “statement savings accounts” in the banking business, savings accounts offered infinitesimal yields after the 2008 financial crisis when the Fed slashed short-term rates to near zero, and kept them there for years, in order to stimulate the economy.
The landscape, however, was turned upside down following the government’s extensive spending during the pandemic. The Fed countered the inflationary effects of lockdowns and rounds of stimulus bills by significantly increasing interest rates to offset soaring prices, prompting banks to raise rates for savers.
Savings account rates — $2,500 minimum deposit
The highest interest rate on a standard savings account today is 4.41%, per Curinos, down from one week ago. Meanwhile, the average APY (annual percentage yield) for a traditional savings account, as reported by Curinos, is 0.20%, the same as last week.
APY represents the return your account will generate in a year, taking into account compound interest—the interest earned on both the principal and previously accumulated interest in your account.
For instance, if you were to invest $2,500 at a 4.41% rate (the current high) for one year, you would earn around $115 in interest, assuming daily compounding and no additional contributions.
Savings account rates — $10,000 minimum deposit
The average APY for savings accounts requiring a minimum deposit of $10,000 is 0.20%, unmoved over the past week. However, numerous financial institutions offer considerably higher rates.
Some of the top high-yield savings accounts, for instance, currently feature rates of 4.00% or higher.
Per Curinos, the highest interest rate today on a savings account requiring a minimum deposit of $10,000 is 4.41%. If you were to invest $10,000 at a 4.41% rate (the current high) for one year, you would earn more than $450 in interest, assuming daily compounding and no additional contributions.
Methodology
To establish average savings account rates, Curinos focused on savings accounts intended for personal use. Savings accounts that fall into specific categories are excluded, including promotional offers, relationship-based accounts, private, youth, senior and student/minor. The average savings rates quoted above are based on a $2,500 or $10,000 minimum deposit amount.
Frequently Asked Questions (FAQs)
The ideal savings account for you hinges on your priorities.
If you already have a relationship with a bank or credit union, such as a checking account or loan, opening a savings account should be straightforward. If you value face-to-face banking, consider an institution with physical branches near your residence.
A high-yield savings account is essentially a standard savings account that offers a higher interest rate on deposits. (It’s more of a description than a technical definition.) This rate can fluctuate based on the broader financial market and the specific bank or credit union’s business requirements.
A high-yield savings account is still a savings account—you can’t access your funds by writing checks and your withdrawals are typically limited.
