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Key Takeaways
- The Fed is expected to cut rates this week, but whether it does or not, the three biggest banks are still the lowest-paying places to keep your savings.
- Chase, Bank of America, and Wells Fargo all pay just 0.01% on savings—essentially nothing compared with the 4%–5% APYs offered by the top high-yield savings accounts.
- Even modest balances see a big difference. At $10,000, the gap between a 0.01% account and a 4.50% account is about $449 in interest per year.
- Smaller FDIC-insured banks and NCUA-insured credit unions are just as safe as the biggest banks, and you can move savings to a high-yield account without changing your primary accounts.
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Big Banks May Feel Safer, but They’re Not—And You Can Earn 4%–5% at Smaller Banks
The Federal Reserve is expected to cut its benchmark rate this week, putting interest rates in the spotlight. But for many savers, the focus should be less on what the Fed does and more on how much your current savings account is paying.
Millions of Americans keep money in savings at Chase, Bank of America, or Wells Fargo simply because that’s where they have their checking account. But that convenience comes at a steep cost. The standard savings rate at all three banks is just 0.01%—that’s one one-hundredth of 1 percent. In other words, even if you hold $10,000 in savings at one of these three biggest banks for a full year, you’d earn just $1.
In contrast, dozens of smaller banks are paying 4% or more on high-yield savings accounts right now, with the most competitive options reaching 5.00% APY. And you don’t have to move all your banking to enjoy the benefits of one of these accounts—you can keep your checking, credit cards, or other accounts where they are while putting your savings in a separate high-yield account.
If safety is what keeps you tied to the big names, rest assured: FDIC insurance protects all banks in the same way, up to $250,000 per depositor, per institution. The same is true for credit unions insured by the NCUA. In other words, smaller banks and credit unions are just as safe—only the earnings on your savings are different.
The Biggest Banks Pay Almost Nothing on Savings—Here’s What That’s Costing You Today
So exactly how much are you losing by keeping savings at one of the biggest banks? Even on a small balance, the gap compared with today’s high-yield accounts is significant. But on larger balances, it becomes staggering.
The table below shows how much you’d earn in a year at 0.01% versus 4.50% annual percentage yield (APY), depending on your balance.
| How Much You’re Losing on Savings at the Biggest Banks | |||
|---|---|---|---|
| 0.01% APY big bank rate | 4.50% APY high-yield rate | Difference over 1 year | |
| $1,000 balance | $0.10 | $45.00 | $44.90 |
| $5,000 balance | $0.50 | $225.00 | $224.50 |
| $10,000 balance | $1.00 | $450.00 | $449.00 |
| $25,000 balance | $2.50 | $1,125.00 | $1,122.50 |
| $50,000 balance | $5.00 | $2,250.00 | $2,245.00 |
| $100,000 balance | $10.00 | $4,500.00 | $4,490.00 |
With FDIC insurance protecting deposits no matter a bank’s size, if you care about earning the best rate, there’s no reason to accept the meager returns offered by the three biggest banks. Whether you have $1,000 or $100,000, moving your savings to a high-yield account means your money will finally work for you—instead of simply sitting idle.
Daily Rankings of the Best CDs and Savings Accounts
We update these rankings every business day to give you the best deposit rates available:
Important
Note that the “top rates” quoted here are the highest nationally available rates Investopedia has identified in its daily rate research on hundreds of banks and credit unions. This is much different than the national average, which includes all banks offering a CD with that term, including many large banks that pay a pittance in interest. Thus, the national averages are always quite low, while the top rates you can unearth by shopping around are often 5, 10, or even 15 times higher.
How We Find the Best Savings and CD Rates
Every business day, Investopedia tracks the rate data of more than 200 banks and credit unions that offer CDs and savings accounts to customers nationwide and determines daily rankings of the top-paying accounts. To qualify for our lists, the institution must be federally insured (FDIC for banks, NCUA for credit unions), and the account’s minimum initial deposit must not exceed $25,000. It also cannot specify a maximum deposit amount that’s below $5,000.
Banks must be available in at least 40 states to qualify as nationally available. And while some credit unions require you to donate to a specific charity or association to become a member if you don’t meet other eligibility criteria (e.g., you don’t live in a certain area or work in a certain kind of job), we exclude credit unions whose donation requirement is $40 or more. For more about how we choose the best rates, read our full methodology.
