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Today’s savings account interest rates are some of the highest we’ve seen in more than a decade due to several rate hikes by the Federal Reserve. Even so, savings interest rates vary widely by bank, so it’s important to be sure you’re getting the best rate possible when shopping around for a savings account. The following is a breakdown of savings interest rates today and where to find the best offers.
Overview of savings interest rates today
The national average savings account rate stands at 0.45%, according to the FDIC. This might not seem like much, but consider that just two years ago, it was just 0.07%, reflecting a sharp rise in a short period of time.
This is largely due to monetary policy decisions by the Fed, which began raising it’s benchmark rate in March 2022 to combat skyrocketing inflation. Since then, the Fed increased rates 11 times, though it paused further rate hikes in 2024. Experts believe the Fed will eventually begin to lower its target rate later this year, which means deposit account rates, including savings interest rates, will likely begin to fall.
Although the national average savings interest rate is fairly low compared to other types of accounts (such as CDs) and investments, the best savings rates on the market today are much higher. In fact, some of the top accounts are currently offering upwards of 5% APY. Since these rates may not be around much longer, consider opening a high-yield savings account now to take advantage of today’s high rates.
Here is a look at some of the best savings rates available today from our verified partners:
Related: 10 best high-yield savings accounts for June 2024>>
How much interest can I earn with a savings account?
The amount of interest you can earn from a savings account depends on the annual percentage rate (APY). This is a measure of your total earnings after one year when considering the base interest rate and how often interest compounds (savings account interest typically compounds daily).
Say you put $1,000 in a savings account at the average interest rate of 0.45% with daily compounding. At the end of one year, your balance would grow to $1,003.60 — your initial $1,000 deposit, plus just $3.60 in interest.
Now let’s say you choose a high-yield savings account that offers 5% APY instead. In this case, your balance would grow to $1,050.85 over the same period, which includes $50.85 in interest.
The more you deposit in a savings account, the more you stand to earn. If we took our same example of a high-yield savings account at 5% APY, but deposit $10,000, your total balance after one year would be $10,512.67, meaning you’d earn $512.67 in interest.
Read more: What is a good savings account rate?