Here’s a look at how today’s savings account rates stack up. The Federal Reserve cut the federal funds rate three times in late 2024, which means deposit rates are now falling. It's more important than ever to ensure you're earning the highest rate possible on your savings, and a high-yield savings account could be the solution.

These accounts pay more interest than the typical savings account — as much as 4% APY and higher. Not sure where to find the best savings interest rates today? Read on to find out which banks have the best offers.

Historically speaking, savings account interest rates have been high. That said, the rates on traditional savings accounts pale in comparison to those offered for high-yield savings accounts.

For example, the average savings account rate is just 0.39%, while the best savings interest rates are generally around 4% to 4.5% APY.

As of August 27, 2025, the highest savings account rate available from our partners is 4.30% APY. This rate is offered by EverBank, Western Alliance Bank, and BrioDirect.

Here is a look at some of the best savings rates available today from our verified partners:

Deposit account rates — including savings rates — are tied to the federal funds rate. This is the target interest rate set by the Federal Reserve; when it increases its target rate, deposit account rates usually increase. And conversely, when the Fed lowers its rate, deposit rates fall.

After multiple interest rate hikes by the Fed in response to skyrocketing inflation, it finally lowered the federal funds rate three times in late 2024. As a result, deposit rates are falling as well.

Experts anticipate that the Fed will cut its target rate two more times in 2025, so we can expect savings account rates to continue falling this year. However, high-yield savings accounts remain one of the best places to safely store cash and earn the best deposit rates available.

Read more: I bond vs. high-yield savings account: Which is better for beating inflation?

Choosing where to put your money is an important decision, and there are a few factors you should consider when evaluating your options. A high-yield savings account could make sense if you’re looking for a secure place to hold shorter-term savings while earning a solid return. Here are a few key considerations:

Interest rates: One of the most important features of a savings account is the interest rate. It’s important to shop around and compare the best offers to ensure your money will grow over time. Considering that savings rates will likely drop in the near future, opening a high-yield savings account now will allow you to take advantage of historically high rates.

Goals: Today’s high-yield savings accounts offer rates we haven’t seen in more than a decade. That said, savings rates still don’t match average returns for the stock market. If you’re saving for a long-term goal like retirement, a savings account probably isn’t the best place to put your money, since your balance won’t grow at a pace that will allow you to reach your target. However, if you’re saving for a financial emergency, a down payment on a home or car, gifts for the holiday season, or another short-term goal, a savings account is a great place to hold those funds.

Accessibility: Certain types of accounts and investments may provide higher returns than a savings account, but may make it difficult to access your funds in a pinch. For example, if you put your savings in a certificate of deposit (CD) and need to access the money before the maturity date, you could be subject to an early withdrawal penalty. So, if you want to be able to dip into your savings as needed, a high-yield savings account is likely the better choice.

Security: In most cases, savings accounts are insured by the FDIC up to the federal limit. They also can’t lose money due to fluctuations in the market, making them a low-risk option.

Read more: Can you negotiate a higher savings account rate with your bank?

If you’re a saver who values lower-risk investment options, money market funds and high-yield savings accounts are two popular solutions you may want to consider. Both typically offer convenient access to your money when you need it and feature other attractive benefits.

Yet despite their similarities, money market funds and high-yield savings accounts work differently in a few key ways. So, it’s important to evaluate your specific situation and financial goals before choosing one over the other.

Read on to learn more about money market funds vs. high-yield savings accounts, and how to determine if either one is a good fit for you.

A money market fund is a type of investment fund, also known as a mutual fund, that’s regulated by the Securities and Exchange Commission (SEC). With money market funds, you can invest your cash into a low-risk pool of assets. These assets may include liquid, short-term debt securities (e.g., U.S. Treasury bills, corporate bonds, municipal debt), cash, and cash equivalents.

Compared to other mutual funds and stocks, money market funds are traditionally made up of low-risk investments. But as a trade off, money market funds have also earned historically lower returns. As a result, money market funds may appeal to risk-adverse investors who are most concerned with trying to protect — rather than aggressively grow — their nest eggs.

Also, keep in mind that money market funds aren’t the same as money market accounts. A money market fund is a type of investment, while a money market account is a type of deposit account, similar to a checking or savings account.

Although the risk is low, there is a small potential for loss with a money market fund if the value of your investment falls. On the other hand, your balance in a money market account or other type of deposit account is typically protected by the FDIC up to $250,000 per depositor, per institution, per ownership category.

Read more: Money market account vs. money market fund: What's the difference?

A high-yield savings account (HYSA) is a type of deposit account that often features a higher annual percentage yield (APY) than a traditional savings account. In fact, some of the best high-yield savings accounts currently feature interest rates that are over 10 times the national average for savings accounts. Because you’re earning more interest on your savings, the money you deposit can grow at a faster rate.

High-yield savings accounts can also be an attractive choice for savers who want easy access to their money at any time. With this type of account, you can generally make withdrawals from your savings balance as needed, without penalty (although some banks impose a limit on the number of withdrawals you can make each month.)

Additionally, as long as you open an HYSA at a federally insured bank or credit union, you can also rest easy knowing that your deposits are protected up to $250,000 in case the institution fails. And your balance can never lose money due to market fluctuations.

Read more: Can you lose money in a high-yield savings account?

That said, it’s important to consider the drawbacks of HYSAs as well. In particular, the rates that these accounts feature are variable, meaning the bank can decide to increase or lower the rate at any time.

Plus, even though the interest rates on HYSAs tend to be competitive compared to some other deposit accounts, they still tend to offer lower historical returns than investments such as stocks, bonds, and mutual funds.

Depending on your financial goals, money market funds and high-yield savings accounts could both make solid solutions for your savings. They both allow you to access your funds without penalty in most cases, and are relatively low-risk savings solutions.

Yet before you deposit your money into a money market fund or a high-yield savings account, it’s wise to review the key differences between these accounts to help inform your decision.

You can open a high-yield savings account at many traditional banks, online banks, and credit unions. However, it’s important to choose a financial institution that’s a member of the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA).

You can purchase money market funds from fund providers (e.g., Vanguard, BlackRock, etc.), through an online brokerage account, or through a bank. Keep in mind that even if you buy a money market fund through a bank, the investment won’t come with FDIC insurance — but money market funds are insured by the Securities Investor Protection Corporation (SIPC) for up to $500,000.

An online broker may also be able to help you select money market funds you can purchase from multiple providers.

High-yield savings accounts don’t usually come with monthly fees, especially those offered by online banks. However, some banks or credit unions do charge monthly fees for these types of deposit accounts, so it’s important to shop around and compare offers.

With money market funds, it’s important to keep an eye on the expense ratios of the funds in which you choose to invest. In 2023, the average expenses ratio for money market funds was 0.22% — an average of $22 for every $10,000 invested. Yet some money market funds may feature higher or lower costs.

You might also have to pay liquidity fees to access your cash during times of high market stress. To find the fee information for a specific fund, check with your online broker or the fund’s prospectus for details. Remember, if you’re already earning relatively low returns on a money market fund, any outgoing fees can easily offset those earnings.

The minimum deposit requirements for high-yield savings accounts are often easy to satisfy for savers with limited cash resources. In fact, you can often find offers for HYSAs with no minimum deposit requirements.

Read more: What's the typical minimum balance for savings accounts?

When it comes to money market funds, minimum investment requirements are more common and may vary to cater to different types of investors. Some money market funds, designed with institutional investors in mind, feature high minimum investment requirements. Meanwhile, you may find funds with much lower or even zero initial investment requirements.

The potential earnings on high-yield savings accounts and money market funds work in different ways. But with both types of financial instruments, your earnings have the potential to change over time with the market.

With high-yield savings accounts, the money you deposit earns a variable interest rate. The bank or credit union will disclose the annual percentage yield (APY) it’s paying customers at the time you open your account. So, you can shop around and compare rates to find the best deal available. But it’s also important to remember that APYs are subject to change over time.

Read more: What is annual percentage yield (APY)?

Money market funds have a fixed price of one dollar per share. The funds aim to maintain their net asset value (NAV), meaning the money you invest (aka your account value) should only change when you have growth from your earnings. The growth you hopefully experience comes from potential yields your account earns.

You can check the 7-day yield of a money market fund to see what a fund is currently paying out to investors. If you find a money market fund with a 5% SEC yield, for example, you may estimate that it’s currently paying out $500 per year on a $10,000 investment.

With high-yield savings accounts, your earnings may count as income and are taxable during the year you earn them.

Money market funds, on the other hand, come in a few different varieties. Prime money market funds are taxable, but they typically offer higher yields. Tax-exempt money market funds are called municipal funds. These funds usually pay lower yields, but they might be worth considering for investors in higher tax brackets due to their (federal) tax-free earning potential.

Some tax-exempt money market funds limit investments to bonds from a specific state. These funds make it possible for residents of certain states to earn completely tax-free yields (both federal and state).

Money market funds and high-yield savings accounts both represent two low-risk ways to grow your savings. If you’re looking to keep a portion of your cash accessible and earn higher-than-average interest rates compared to traditional deposit accounts, either of these options could be worth considering.

Yet it’s important to recognize that neither of these savings solutions may be the best fit for your long-term retirement needs. Both account types earn historically lower interest rates compared to other investment options. So, you could miss out on significant growth opportunities if you keep the bulk of your retirement savings locked away in high-yield savings accounts or money market funds alone.

If you’re not sure where to save or invest your money for the future, it might be time to meet with a certified financial planner (CFP). A trustworthy financial advisor can help review your specific financial goals, answer questions, and create a plan for your financial future.

Questioning where to keep your retirement savings? With a volatile stock market, you may be wary of putting your hard-earned money into investments that can lose value. Meanwhile, a high-yield savings account (HYSA) can offer a safe, reliable return. Today, the best HYSAs pay above 4%.

However, you could lose out in a big way if you go with a bank account over an employer-sponsored retirement account. Why? Even if you contribute to an HYSA with a competitive interest rate, your earnings won't match the average returns you get on a 401(k). Plus, you miss out on other benefits like the ability to reduce your tax bill.

High-yield savings accounts and 401(k)s have very little in common since they're built to serve very different purposes. HYSAs are not built to hold retirement savings, but they are great for emergency savings since they give you:

Quick access to your money when you need it.

Higher interest rates than most other types of deposit accounts.

FDIC insurance to protect you from losses.

The main downside to keeping your long-term savings in an HYSA is that interest rates are variable. That means even if you start out with a rate as high as 4% to 5%, your rate could drop at any time. And historically speaking, HYSA rates don't keep pace with inflation.

Read more: Are HYSAs less favorable when interest rates are low​?

For spare cash that you don't need access to in the next few years, a 401(k) is a much better choice. These accounts are specifically built to help you save for retirement, and average returns are much higher than savings accounts (which are further compounded by a long-term investing horizon).

Yes, your 401(k) can lose money in a volatile year, but if you spread the money across different companies and sectors (also known as diversification) and you invest for the long term, your returns will easily beat what you earn on a savings account.

Read more: What is a 401(k)? A guide to the rules and how it works.

According to a 2024 report from Vanguard, 401(k)s and other defined contribution plans earned average returns of 9.7% from December 2019 to December 2023. By comparison, the best rates you could find on a HYSA in 2018 and 2019 were near 2% APY, and in 2020 it was near 1% APY.

A high-yield savings account is not a substitute for a 401(k). Yes, you may be able to find accounts with 4% APY or more right now, but your rate can drop at any point in the future. And even if it remains high for a while, you can still earn more from a 401(k).

For example, let's say you contribute $200 a month to both types of accounts. If your HYSA consistently earns 4% APY, your account balance will hit $29,508 in 10 years.

By comparison, a 401(k) that earns 7% will be worth $34,753 in 10 years. That's a difference of $5,245, and it doesn't take into consideration the other financial benefits you get from investing in a 401(k), like deferred taxes.

Here are the main benefits you get from choosing a 401(k) over a high-yield savings account for your retirement savings:

Higher average returns: It's difficult to beat the returns you earn on a 401(k), which can average up to 8%.

Employer match: Your employer may match a portion of your contribution, which means you get free money invested into your account.

Tax benefits: Your contributions can be deducted from your taxable income, resulting in a lower tax bill.

That doesn't mean an HYSA is a bad choice. In fact, it's one of the best places you can deposit savings for an emergency fund and other short-term goals. It simply means that an HYSA is not the right account to help you reach your retirement goals.

You should not make an early withdrawal from your 401(k) unless you're facing a financial emergency and have no other way to come up with the cash you need. If you do make an early withdrawal, you'll most likely have to pay income taxes on that amount, plus an additional 10% tax.

If your employer doesn't offer a 401(k), check to see if they have another employer-sponsored retirement plan, such as a 403(b), 457(b), SEP, or SIMPLE IRA. If not, consider opening up a traditional IRA, since these retirement accounts offer similar tax benefits to traditional 401(k)s.

After maxing out your 401(k) you might be tempted to turn to a HYSA or another bank account. Instead, consider a traditional IRA, since contributing can help you further reduce your taxable income.

Read more: How much should I contribute to my 401(k)?

If you’re looking for a safe place to keep your savings while helping it grow, you may have come across high-yield savings accounts (HYSAs). These accounts provide some of the highest annual percentage yields available today.

However, you may wonder if high-yield savings accounts are safe. After all, many HYSAs are offered by online institutions, some of which may be unfamiliar to you.

Generally, high-yield savings accounts are perfectly safe. Learn more about why these accounts are so secure and how to choose the right one.

As a general rule, high-yield savings accounts are absolutely safe. Here's why:

The Federal Deposit Insurance Corporation (FDIC) guarantees deposits up to $250,000 per depositor, per institution, per ownership category. In the case of credit unions, the National Credit Union Administration (NCUA) provides similar insurance. That means in the rare instance your financial institution fails, you’ll get your money back as long as it’s held at a federally insured institution and the balance is under the $250,000 limit.

If you have more than $250,000 in deposits, it’s important to spread that money across different banks and account types — and always ensure that your financial institution is federally insured. You can find out by using FDIC’s BankFind website tool or the NCUA’s credit union research website.

Read more: How to insure deposits over $250,000

Unlike investments, which can gain and lose value depending on how the stock market performs, you can’t lose money in a high-yield savings account due to market fluctuations. If rates are low, you may not earn as much in interest — but the only way your balance can go down (aside from making withdrawals) is if you incur bank fees.

Read more: Can you lose money in a high-yield savings account?

This is a big reason to use a high-yield savings account. Most traditional savings accounts offer interest rates under 1%. Yet today, inflation stands at less than 3%, and in recent years, it hit as high as 9%.

In other words, if your savings account’s interest rate is less than the current inflation rate, the value of your dollars is decreasing over time and your money won't go as far when you spend it. But with today's high-yield savings accounts — the best of which offer 4%-5% APY — your interest earnings will outpace inflation.

Read more: How to protect your savings against inflation

Money in certain investments is not easy to access at a moment’s notice. With stocks, for example, you must first sell shares at the current price and then transfer the funds to your checking or savings account. Even with a certificate of deposit, you have to wait until it matures to pull your money out or else pay an early withdrawal penalty.

But a high-yield savings account allows you to withdraw money as needed. There is no fee to do so, although you may be limited on how many fee-free withdrawals you can make in a month.

Read more: What is a 'liquid' asset? Definition and examples.

In general, high-yield savings accounts are an excellent option for securely storing your savings and earning a competitive return. That said, these accounts don’t make sense in every situation. Before putting your money in an HYSA, consider these factors first:

Interest rate: Though high-yield savings accounts are, by name, supposed to provide higher interest rates than other types of deposit accounts, rates do vary. Some banks offer HYSAs with rates as high as 5% APY or more, while others offer much less.

Minimum balance requirements: Some banks may require you to keep a certain amount of money in your savings account to earn the highest advertised rate or require a minimum deposit to open an account. Be sure you have the cash on hand to meet minimum balance requirements.

Fees: Most banks don’t charge monthly maintenance fees for high-yield savings accounts, but there may be other types of fees you could incur. These include excess withdrawal fees, overdraft fees, and inactivity fees, all of which cut into the profits you’re earning from interest.

The answer to whether a high-yield savings account is right for you depends on… you. If you’re looking for an account that will protect your money, hedge against inflation, and help your balance grow, an HYSA is one of the best options out there.

However, if you’re saving for a long-term goal like retirement, even the high yields of these accounts won’t be enough to get you there. For bigger savings goals with a long timeline, higher risk (but higher reward) investments are necessary.

Read more: High-yield savings account vs. investing: Which is right for you?

High-yield savings accounts generally offer better interest rates than regular savings accounts, but they don't compare to the returns you can achieve through market investments. If you keep too much money in an HYSA, you risk losing out on higher long-term returns. That's why it's best to keep funds for short-to medium-term savings goals in an HYSA ,and invest money that's meant for long-term goals such as retirement or funding your child's future education.

Technically, a high-yield savings account doesn’t directly lose money in the same way as investments might, since deposits aren't subject to market risk. However, if inflation outpaces your HYSA’s interest rate, the real value of your savings could effectively decrease over time, meaning you may lose purchasing power. Additionally, some accounts charge fees if certain conditions aren’t met (e.g., minimum balance requirements), which could cause your balance to decrease.

Despite their many benefits, high-yield savings accounts do come with some potential downsides. For instance, some HYSAs — especially those offered by online-only banks — don’t offer ATM access or branch services, which could limit how quickly you can access your funds. Also, some banks may limit certain types of withdrawals or transfers to six per month, and exceeding this limit could lead to fees or account restrictions. Finally, shile HYSAs are safer, they don’t provide the same growth potential as stocks, bonds, or other investments over the long term.

If you’re looking to store money for short-term goals, such an emergency fund or big-ticket purcahse, a high-yield savings account is typically worth it due to its liquidity and safety.