The Best Savings Account

It's all about the highest interest rate

Our Favorite Pick

The Best Savings Account

Ally Bank Online Savings

We spent 70 hours analyzing data from thousands of US-based financial institutions, surveyed hundreds of consumers, reached out to 40 experts, and experimented with the online and mobile features of dozens of accounts.

We invested an additional 50 hours collecting more key data about the top savings accounts, and used all this information to narrow our list of more than 27k financial institutions down to the four best savings accounts.

When it comes to finding the best savings account, you have a lot of options. Traditional brick-and-mortar banks, credit unions, online-only banks, insurance companies, credit card companies, and other financial institutions all offer savings accounts — and they’re all battling for your business.

We focused on traditional and online-only banks that are widely available, financially stable, have above average consumer satisfaction, and offered a high interest rate.

In the end, the interest rate became the pivotal factor. All of the top traditional banks offer interest rates of 0.01% — considerably lower than the 1.05% available with leading online-only banks.

A savings account should be more than a safe place to park your money, it should actually help you build your wealth. We found that these four savings accounts help you do it best.

The best four savings accounts are:

GE Capital Bank
CIT Bank

What We Learned

Early Assumptions

We approached this review with two main assumptions:

  • Interest rates matter - A lot

    A high interest rate should be the defining factor when selecting a savings account.

  • Emergency funds are important

    In addition to saving for retirement and other long-term goals, most people have a savings account to be prepared for unexpected circumstances.

Consumers choose convenience

When we surveyed consumers, we found that interest rates didn’t factor into savings account decisions nearly as much as we’d expected.

Convenience trumped interest rate… but should it?
In our survey, 61% of consumers told us they chose their savings account because they have an existing relationship with their bank. Only 11% picked their savings account based on the interest rate. We actually side with the 11% of consumers who chose their savings account based on interest rate. The more you can save now, the more it can compound in the future.

Having money set aside for a rainy day is the top reason people save money – by far.
42% of consumers in our survey said emergency / loss of income was the primary reason for a savings account — and another 31% said that their primary savings goal was financial security. Between these two, about three-quarters of respondents were saving to secure their future.

There are more ways to save money

Standard savings accounts are the most common way to save money and grow your wealth, but they certainly aren’t the only option. Depending on your goals and circumstances, it might also make sense to look into money markets, certificates of deposits (CDs), IRAs. We highlight some of the popular savings account types below and plan to write an in-depth article on IRA accounts in the future.

Best for everyday savings. A relatively low interest rate in exchange for anytime access to your funds.

Similar to savings accounts, but usually with a higher interest rate and a larger minimum balance requirement.

One-time deposit with a locked interest rate – but you can’t touch your money for a set period of time.

Regardless of what you’re saving for, the fact is that you could be maximizing that saving by finding an account with a high interest rate.

What to watch out for:

Just as in checking accounts, you should watch out for hidden fees with your savings account, which could end up costing you more money than you can accumulate in interest. Some of the most common fees include:

  • Monthly Maintenance Fees

  • Minimum Balance

  • Dormancy/Inactivity

  • Excessive Withdrawal

Teaser Intro Rates
Often, to get new customers in the door, banks will promise high interest rates on savings accounts for a short term, but change the rate over time. When looking for a new savings account, find a bank that offers sustained interest rates that benefit you.

Make sure, above all, your money is safe and sound, and if something does happen, your account is protected and you will not have financial loss.

Trevor Rasmussen Deluxe Corp

Features to Look For

  • High Interest Rates

    You want an account that makes money while you save money.
  • Daily Interest Compound

    Compounded interest adds up faster.
  • Online Management

    Easy online tools make your finances more convenient and transparent.
  • No Transaction Limits

    Find an account that prizes your freedom.
  • Financial Security

    You want a bank where your money can live for a long time, so being FDIC insured and having a strong financial strength rating and outlook is a must.

How we found the best savings accounts

We started our review by compiling a massive list of banks, credit unions, insurance companies, credit card providers, and other financial institutions that offer savings accounts. All of the banks we reviewed are US-based and FDIC insured.

After staring at a spreadsheet with data from 27,000+ institutions, our research team began to identify key savings account characteristics and we were able to start narrowing down the list.

One factor that immediately became apparent was the importance of availability. A savings account from a local credit union might offer great rates, but if it’s only available to members of a certain community, it didn’t make sense to include it in our review.

We couldn’t recommend a single credit union to everyone so credit unions were cut from our list. We still recommend checking the interest rates at your local credit union before signing up for one of our top picks.

Because online-only banks are inherently available to anyone with an Internet connection, we outlined separate criteria for evaluating online-only and traditional banks.

Online-Only Banks

For the purposes of this review, online-only banks had to meet the following criteria:

  1. Must have substantial assets
  2. Must have positive or stable financial outlook ratings
  3. Must have daily compounding interest
  4. Minimum balance requirement of $100 or less
  5. Must have an interest rate of 0.9% or higher

Based on this criteria, we were able to narrow a list of 18 online-only savings account options, down to a list of the top four contenders.

Traditional Banks

For traditional brick-and-mortar banks, the requirements include:

  1. Must have substantial assets
  2. Must have positive or stable financial outlook ratings
  3. Must be widely available
  4. Must have above average consumer satisfaction ratings
  5. Must have daily compounding interest
  6. Must have a relatively high interest rate

When you’re saving money, you want a reliable bank that’s going to be with you in the long-run. We looked at two sets of metrics to determine financial stability: total assets and financial strength ratings. We sorted our list of 27k banks based on total assets, and focused on the 100 largest. We then spent hours gathering and comparing financial strength ratings from Moody’s, S&P, and Fitch. Banks had to have positive or stable long-term financial strength ratings from these firms. Any bank with a negative long-term outlook rating was cut from our list.

We used the 2015 J.D. Power and Associates Retail Banking Satisfaction Study℠ as a benchmark for customer satisfaction. If a bank did not beat (or match) the regional average score in at least half of the regions where the bank is available, we cut it from the list.

In addition to analyzing the total assets, financial strength, online/mobile tools, customer satisfaction, and availability, we also collected interest rates, fees, balance requirements, and other critical data associated with each of the top 20 accounts.

Wells Fargo, Chase, US Bank, PNC Bank, and Bank of the West all met the criteria outlined in our methodology. But when we went to compare interest rates, we realized that they all offer a meager 0.01%.

And that’s when we determined that recommending traditional banks offering an interest rate of .01% alongside online-only banks that offer .9 – 1.05% just doesn’t make sense.

Interest rate should be the defining factor

Regardless of whether you’re saving for a rainy day or for college, a savings account should help build your wealth, and the traditional banks offering .01% are not worth your time or money.

The difference between .01% and 1.05% may not seem that striking, but when you actually run the numbers (see the chart below), you recognize that you are literally earning 100x the return by going with an online-only bank.

If the convenience of saving with your existing bank is more of a priority than interest rate, you’re much better off looking into a money market or CD, as the interest rates there are usually more favorable.

The Concessions Are Worth It

Before signing up for an online-only account, there are a couple caveats to be aware of:

No brick-and-mortar branches
Online-only banks obviously don’t have physical locations. This means you can’t just walk into the bank and walk out with your money. If you need to make a withdrawal, online-only banks can cut you a check or you can simply transfer funds to another account (e.g. a personal checking account). These transactions are free, but your funds might not show up in your account for a day or two. Similar, deposits can be made through an ACH transfer, direct deposit from an employer, or by mailing in a paper check. Faster withdrawals / deposits can be made with wire transfers, but these usually cost extra money.

No checks or ATM cards
Some savings accounts with traditional banks also issue paper checks and ATM cards, a feature not offered for savings accounts with most online-only banks. Federal regulations limit withdrawals from savings accounts to six per month, so these transactions don’t happen on a regular basis. But if you’re accustomed to accessing your savings at an ATM with a debit card, or writing a check directly from your savings account, these missing features might be a dealbreaker.

But again, we took the position that a savings account should enable you to build wealth. The fact that you’re actually earning meaningful money with online-only accounts outweighs the minor inconvenience of waiting an extra day to see your funds or not being able to write a check directly from the account.

Top Picks

The Best Savings Account

Synchrony High Yield Savings Account

With interest rates over 1%, Synchrony is like many online banks in that it offers very high interest on savings accounts. The minimum balance for a Synchrony savings account is just $30, making fee avoidance incredibly easy. Plus, they offer mobile check deposit, even if you don’t have a checking account with them.

  • Online Only
  • Interest Rate 1.05% APY
  • Monthly Maintenance Fee $5
  • Minimum Balance to Open $30
  • Compound Schedule Daily
  • Requirements to keep account free Minimum Balance of $30
The Best Savings Account

GE Capital Bank Online Savings

GE Capital Bank’s online-only savings account offers a high interest rate, no fees or minimum balances, and interest that’s compounded daily and paid out monthly.

  • Online Only
  • Interest Rate 1.05% APY
  • Monthly Maintenance Fee None
  • Minimum Balance to Open None
  • Compound Schedule Daily
  • Requirements to keep account free None
The Best Savings Account

Ally Bank Online Savings

Though interest rates at Ally aren’t quite as high as other online-only banks, they still boast close to a full percent. Additionally, their online savings account has free mobile check depositing, no fees, unlimited monthly deposits, and daily compounded interest.

  • Online Only
  • Interest Rate 0.99% APY
  • Monthly Maintenance Fee None
  • Minimum Balance to Open None
  • Compound Schedule Daily
  • Requirements to keep account free None
The Best Savings Account

CIT Bank High Yield Savings

FDIC-insured with no fees, CIT Bank’s high-yield savings account boasts 1.05% interest rates and no opening or maintenance fees. They also offer daily compounding and free online banking.

  • Online Only
  • Interest Rate 1.05% APY
  • Monthly Maintenance Fee None
  • Minimum Balance to Open $100
  • Compound Schedule Daily
  • Requirements to keep account free None

The best savings account is the one that helps build your wealth

The main goal of any savings account is to accumulate money, either for an emergency situation, or for a goal, like retirement. But your savings account should do more than just hold your money — it should grow your money. And for that reason, a high interest rate is an essential factor.

Savings accounts at traditional banks simply don’t offer competitive interest rates. If the convenience of staying with your existing bank is your top priority, consider a money market or CD, which generally offer higher interest rates. Otherwise, we recommend looking to online-line only banks with significantly higher interest rates.

If you think there has been a mistake, please let us know by tweeting @reviews and we’ll fix the mistake and update our review!