The Federal Reserve cut its target rate three times at the end of 2024, meaning savings rates are falling from their historically high rates. It’s important to make sure you’re getting the best possible rate when looking for a savings account. The following is an overview of today’s interest rates on savings and where to find the best offers.
The national average savings account rate is 0.42%, according to the FDIC. That may not seem like much, but consider that three years ago it was just 0.06%, reflecting a sharp increase in a short period of time.
Today, the highest savings rate available from our partners is 4.75% APY. This rate is offered by Openbank and there is a minimum initial deposit of $500.
Since those rates may not be around much longer, think about it opening a high yield savings account take advantage of today’s high rates now.
Here’s a look at some of the best savings rates available today from our trusted partners:
Related: 10 Best High Yield Savings Accounts Today>>
The amount of interest you can earn on a savings account depends on annual percentage rate (APY). This is a measure of your total earnings after one year when taking into account the base interest rate and how often interest is charged (savings account interest is usually charged daily).
Let’s say you put $1,000 into a savings account at an average interest rate of 0.42% compounded daily. At the end of one year, your balance will grow to $1,004.21 — the initial $1,000 deposit, plus just $4.21 in interest.
Now let’s say you choose a high-yield savings account that offers 4% APY instead. In that case, your balance would grow to $1,040.81 over the same period, which includes $40.81 in interest.
The more you deposit in a savings account, the more you will earn. If we take our same high-yield savings account example with 4% APY, but deposit $10,000, your total balance after one year would be $10,408.08, meaning you’d earn $408.08 in interest.
Read more: What is a good savings account rate?
