March 22, 2024 – Forbes Advisor – Technologist

Rates on savings accounts are mixed compared to one week ago. You can now earn 5.84% or higher on your savings.

Searching for an account where you can put some money aside? Here’s a look at some of the best savings rates you can find today.

Related: Compare the Best High-Yield Online Savings Accounts

Traditional Savings Account Rates Today

Traditional savings accounts, called “statement savings accounts” within the banking industry, are infamous for paying puny interest rates. That’s starting to change, thanks to the Fed’s campaign of interest rate hikes to combat inflation.

Today’s highest rate on a standard savings account with a $2,500 minimum deposit requirement is 5.84%, according to data from Curinos. If you spot a basic savings account with a rate in that general area, you’ve found a good deal. One week ago, the best yield also was 5.84%.

Today’s average APY for a traditional savings account is 0.23%, Curinos says. APY, or annual percentage yield, shows the actual return your account will earn in a year. It includes compound interest, which is interest that builds on the interest already in your account.

High-Yield Savings Account Rates Today

High-yield savings accounts typically pay substantially higher interest than conventional savings accounts. But the catch is you may have to meet tough requirements set by the bank or credit union. Often, that means making a large deposit to open the account.

On high-yield accounts requiring a minimum deposit of $10,000, today’s best interest rate is 5.35%. That’s unchanged from one week ago.

The average APY for those accounts is now 0.24% APY, about the same as a week ago.

On high-yield savings accounts with a minimum opening deposit of $25,000, the highest rate offered today is 4.97%. You’ll be in good shape if you can find an account offering a rate close to 4.97%. Last week at this time, the best rate was 4.89%.

The current average is 0.25% APY for a high-yield account with a $25,000 minimum deposit. That’s above last week’s 0.25%.

How To Shop for a Savings Account

To find the best savings account for your needs, you first must answer the question: What exactly are you looking for? And you must realize that different types of accounts have trade-offs.

If you want to open an account at a traditional bank with branches, that will likely rule out the best interest rates, which are typically available at online-only banks. Many traditional savings accounts at brick-and-mortar banks earn just 0.01% or 0.02% APY, while some online-only savings accounts earn more than 4.00% APY.

Don’t settle on any option until you’re certain you have a good grasp on the fees you’ll be charged. Savings accounts can ding you with monthly service fees, excess withdrawal fees and returned item fees (if you deposit checks that bounce), among others. Those charges add up and can gnaw away at your savings.

As you shop around, check reviews and ratings of financial institutions and make sure you choose one that will protect your money with federal insurance—from the FDIC or, in the case of credit unions, the NCUA.

How Often Do Savings Account Interest Rates Change?

Interest rates on savings accounts typically fluctuate in response as other rates change throughout the economy. Savings rates are primarily influenced by the Federal Reserve’s rate moves, and the central bank has recently been raising its benchmark federal funds rate in an attempt to get inflation under control.

But while financial institutions are usually quick to raise credit card rates and other borrowing costs as the Fed raises rates, they tend to stall when it comes to increasing interest rates on savings. Rates on savings accounts have been rising little by little, and that’s likely to continue throughout 2023.

Methodology

Curinos determines the average rates for savings accounts by focusing on those intended for personal use. Certain types of savings accounts—such as relationship-based accounts and accounts designed for youths, seniors and students—are not considered in the calculation.