The saving account interest rates are changing frequently and you will be surprised to learn that unlike in our countries, in the US the interest rate is not guaranteed and is not fixed. What this means is that you may open a saving account with one rate and end up getting something else. What you should know that the interest rates go both directions. If Fed raises rates your saving account interest rate will increase as well, if the Fed decreases rates your interest rate will go down as well.
Now you may have heard from various news outlets that that Fed cut its rates almost to zero to help US Economy battle the consequences of Corona Virus. What this means is that the interest rates on our savings accounts have declined. However, you can still find some good offers on the market.
What I noticed and what is most obvious is that online only banks provide the best interest rates on the savings account. The justification for this is quite simple. They are much more cost efficient in running their operations than traditional banks (remember they don’t have physical locations, but this won’t prevent you from accessing your money, however it will take few days to be transferred to your bank).
So, below I searched for some FDIC insured banks offering high rates on saving accounts:
- Citizens Access – this is a subsidiary of Citizens Bank and they offer 1.5% on saving accounts. The minimum amount you need to deposit to start earning this rate is $5,000 and they don’t charge any premiums. I opened a savings account at this bank last year and they were offering 2.45% so you can see by how much the interest rates declined.
- Simple – they offer 1.55%, but they have ranges, meaning that you need to keep certain amount in your account to earn maximum interest rate.
- Marcus by Goldman Sachs – is also offering 1.55%.
- HSBC Direct – also a subsidiary of multinational bank HSBC only available online is offering 1.75%.
- Popular Direct – also a subsidiary of Bank Popular (you might see their branches in New York) offers 1.75% as well with a requirement of depositing $5,000.
- American Express – American Express even though is a Credit Card company they do offer saving rate of 1.6% with no fees and no minimums.
- Citi Accelerate Savings – offers 1.6% and has branches you can access; however, it comes with some tricks and fees, please make sure to ask if there are any fees you need to pay on this saving account at Citi Bank branch.
Please remember that all of the banks above (except Citi bank) are online only banks. Most of the time the rates for online bank offers are comparable.
As always please check the terms and conditions of product you are choosing and as I said above the interest rates change and the ones I indicated here are as good as of today. At the moment when you are reading this post, the interest rates have changed.
Good luck saving!