Who are high-yield savings accounts good for?

High-yield savings accounts are good for anyone saving for emergencies or short-term savings goals , such as car repairs or a vacation. It’s also a great place to put unexpected financial windfalls, such as a tax refund or inheritance, while you decide whether you want to save, invest or spend the money.

What are alternatives to HYSAs?

In general, there are three savings account options if you’re looking for an alternative to high-yield savings accounts . Traditional savings account: A traditional savings account is typically offered by a brick-and-mortar bank or local credit union . You won’t earn much interest compared with high-yield savings accounts, but you will have ATM access to make cash deposits and withdrawals. Some of these accounts are limited to six monthly withdrawals, although ATM withdrawals may be excluded from that restriction. Money market account: A money market account combines the features of a checking and savings account. This account usually requires a higher balance to earn interest and keep your account in good standing. You may only be able to make a limited number of withdrawals per month. Many money market accounts come with checking account features, such as a debit card, ATM access and check writing privileges. Certificates of deposit: A certificate of deposit offers a fixed interest rate for a set period, known as the term. If you withdraw your money before the term ends, you’ll pay an early withdrawal penalty, which is usually a few weeks or months of interest, depending on the bank. CDs only allow a one-time deposit. Most CDs have terms from three months to five years.

How do banks determine APYs for high-yield savings accounts?

Each bank has a proprietary methodology for setting APYs, but they typically follow the Federal Reserve's moves, raising APYs when the Fed raises rates and vice versa. Since the Fed has paused rates at its last two meetings, APYs for deposit accounts such as savings accounts have largely held steady.

What is a good APY for a high-yield savings account?

Based on CNET's daily tracking, the average savings rate is over 4%, but many banks are offering close to 5%. We're seeing some banks lower rates slightly, so it’s best to take advantage of competitive rates while they last.

When will APYs for high-yield savings accounts begin to drop?

Rates have already started to decline from record-high APYs that were over 5%. Since the Fed lowered rates several times last year, savings account APYs will likely continue to drop. So the sooner you open a high-yield savings account, the more interest you can earn.

Table of Contents

Compare the best high-yield savings accounts
The best high-yield savings accounts
What is a high-yield savings account?
What’s happening with high-yield savings account rates?
How a high-yield savings account can help you reach your savings goals
Why you need a high-yield savings account
Watch out for these barriers when opening a high-yield savings account
Best ways to use a high-yield savings account
How to open a high-yield savings account
FAQs
Methodology

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Article updated on Mar 26, 2025

Best High-Yield Savings Accounts for March 2025

Grow your savings faster with APYs up to 5%.

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Article updated on Mar 26, 2025

A high-yield savings account is a federally insured account to save money for short-term goals or needs, while still earning an above-average annual percentage yield — compared to traditional savings accounts. However, high-yield savings accounts earn a variable interest rate that can change at any time, but typically move in the same direction as the Federal Reserve’s rate decision.

Table of Contents

Compare the best high-yield savings accounts
The best high-yield savings accounts
What is a high-yield savings account?
What’s happening with high-yield savings account rates?
How a high-yield savings account can help you reach your savings goals
Why you need a high-yield savings account
Watch out for these barriers when opening a high-yield savings account
Best ways to use a high-yield savings account
How to open a high-yield savings account
FAQs
Methodology

Best High-Yield Savings Accounts

Newtek Bank 4.45% APY, $0 Min. deposit to open
LendingClub 4.50% APY, $0 Min. deposit to open
My Banking Direct 4.40% APY, $500 Min. deposit to open
Bask Bank 4.35% APY, $0 Min. deposit to open
Bread Savings 4.40% APY, $100 Min. deposit to open
BMO Alto 3.70% APY, $0 Min. deposit to open
TAB Bank 4.26% APY, $0 Min. deposit to open
Laurel Road 3.80% APY, $0 Min. deposit to open
UFB Direct 4.01% APY, $0 Min. deposit to open
Synchrony Bank 4.00% APY, $0 Min. deposit to open
Quontic Bank 3.85% APY, $100 Min. deposit to open
Citizens 3.70% APY, $0 Min. deposit to open
Zynlo Bank 4.35% APY, $10 Min. deposit to open
Varo Bank 2.5% to 5% APY, $0 Min. deposit to open

Helpful Definitions

Savings account

A deposit account issued by banks, credit unions and neobanks used to store money and earn a small amount of interest. Typically, these accounts are insured for up to $250,000 per account owner, per institution.

High-yield savings account

An interest-bearing account similar to a traditional savings account that pays a much higher annual percentage yield, or APY, than the average savings account. They are also typically insured for up to $250,000 per account owner, per institution.

Certificate of deposit (CD)

A type of savings account in which a lump-sum deposit accrues interest at a fixed rate for a fixed term, usually with an early withdrawal penalty.

Money Market Account (MMA)

Similar to a savings account but with the added feature of check-writing privileges and a debit card to access cash, often with limitations on the number of monthly withdrawals.

Annual percentage yield (APY)

An interest rate that represents the return from the compounded interest you’ll earn in 12 months on your deposit. The higher the APY, the faster your money grows.

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Table of Contents

Compare the best high-yield savings accounts
The best high-yield savings accounts
What is a high-yield savings account?
What’s happening with high-yield savings account rates?
How a high-yield savings account can help you reach your savings goals
Why you need a high-yield savings account
Watch out for these barriers when opening a high-yield savings account
Best ways to use a high-yield savings account
How to open a high-yield savings account
FAQs
Methodology

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Dashia Milden

Editor