Best High-Yield Savings Accounts

If you don't already have a high-yield savings account, why not? By not taking advantage of saving rates, which are currently very high, you're leaving money on the table. Easy money. Setting up a high-yield savings account is simple, making it an obvious place to save your cash. You'll earn interest on your money over time, with zero effort on your part.

However, savings rates on high-yield accounts have been inching down over the last several months, falling even further after September's Fed meeting. At its latest policy-setting meeting, the Federal Reserve cut interest rates by 50 basis points, the first rate cut in four years.

However, some of the top-earning savings accounts are still offering rates around 5%, significantly higher than the national average for traditional savings accounts, which is why it's still worth it to open a high-yield savings account.

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High-yield savings accounts

Here are some of the top earning high-yield savings accounts available today:

Poppy Bank

APY: 5.00%

Minimum opening deposit: $1,000

PiBank

APY: 5.50%

Minimum opening deposit: $0

Western Alliance Bank

APY: 4.81%

Minimum opening deposit: $500

My Banking Direct

APY: 4.85%

Minimum opening deposit: $500

Flagstar Bank

APY: 4.75%

Minimum opening deposit: $25,000

Brio Direct

APY: 5.00%

Minimum opening deposit: $5,000

Ivy Bank

APY: 5.00%

Minimum opening deposit: $2,500

Forbright Bank

APY: 5.00%

Minimum opening deposit: $250

Newtek Bank

APY: 5.25%

Minimum opening deposit: $0

Evergreen Bank Group

APY: 4.75%

Minimum opening deposit: $100

Jenius Bank

APY: 4.80%

Minimum opening deposit: $0

UFB Direct

APY: 4.57%

Minimum opening deposit: $0

Laurel Road

APY: 4.50%

Minimum opening deposit: $0

Bread Savings

APY: 4.75%

Minimum opening deposit: $100

RBMax

APY: 4.65%

Minimum opening deposit: $10

Upgrade

APY: 4.69%

Minimum opening deposit: $1,000

Popular Direct

APY: 4.76%

Minimum opening deposit: $100

Essentially, high-yield savings accounts are the same as traditional savings accounts with one key difference — high-yield savings accounts pay a higher-than-average APY on deposits, meaning you'll be able to accrue more cash over time. And they're great options if you're looking for a risk-free way to maximize your savings.

Most high-yield savings accounts are federally insured, keeping your savings secure if your bank or credit union fails. If you open an account through a bank, the FDIC will protect up to $250,000 in individual deposit accounts and up to $250,000 for each person’s share of joint accounts. For accounts opened with a credit union, the NCUA will protect up to $250,000 per credit union member (whether in an individual or a joint account.

Unlike CDs in which your cash is locked away for a fixed period of time, high-yield savings accounts let you easily access the funds in your account. For this reason, they're good options for short-term savings goals or emergency funds. Plus, sometimes these accounts offer a savings account bonus, putting more money in your pocket.

Another way to browse rates on high-yield savings accounts is by using our tool, in partnership with Bankrate, below.

Pros and cons of high-yield savings accounts

As with all savings vehicles, there are both pros and cons associated with high-yield savings accounts. It's important to compare all aspects of an account before opening it.

Pros

• Higher APYs: Since high-yield savings accounts have higher APYs than traditional savings accounts, you’ll accrue more interest over time. Plus, interest in these accounts is compounded daily.
• Safety: Many high-yield accounts are FDIC or NCUA insured, meaning that if something were to happen to the bank (or credit union) your account is with, your money will still be safe.
• Accessibility: While there are sometimes limitations to the number of free withdrawals you can make from a savings account, your money is still readily accessible whenever needed.

Cons

• Harder to access than traditional savings accounts: If you have a savings account that's with a different bank than your checking account, you may have to wait a few days for funds to transfer from one to the other. Plus, you won’t be able to easily view account details for both accounts in one place.
• Not suited for long-term goals: If you’re looking to save for long-term goals, like retirement, other investments, like stocks, are usually a better choice for your money. The rate of inflation can be higher than what you accrue in interest.
• Variable interest rates: Since interest rates are variable, the APY on the account can decrease from the rate it was when you opened the account.
• Minimum deposit requirements and fees: Many high-yield savings accounts charge a monthly fee and/or require a minimum deposit to earn the advertised APY.
• Online banks: Since most high-yield accounts are offered by online banks, you likely won’t have branch access, so contacting customer service can be more challenging.

Bottom line

Opening a high-yield savings account should be a no-brainer. If you don't have one yet, you're leaving money on the table. High-yield savings accounts offer higher rates than traditional savings accounts, meaning your cash will accrue more interest by simply sitting in a high-yield account than it would in a standard account. And there's no risk, either.

The downside? Since rates on high-yield savings accounts fluctuate with the market, rates will drop further this year as the Fed continually cuts interest rates. So make sure you're taking advantage of the best rates while you still can.

Related Content

• What Is a High-Yield Savings Account?
• The Fed Just Cut Rates. What Should Savers Do About CDs and High-Yield Accounts?
• Best 5-Year CD Rates