Are you earning the most from your savings and money market deposit accounts? Savings and MM accounts are the foundation of a strong financial plan, providing you with financial stability as you work to achieve your goals. There are many banks and credit unions that offer savings and money market accounts. This article aims to help you find the highest interest rates for this type of deposit account.
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Top 10 Best High-Interest Savings Accounts for July 2020
Since the last update, most of the banks have dropped from their rates and stabilized around the 1% level. Here is our most updated list with an indicator showing rates that went up (⇑) and ones that went down (⇓).
|CIBC Agility™ Online Savings Account||1.15% ⇓||$0.01 minimum. No maintenance fees.|
|Live Oak Bank||1.15% ⇓||No minimum. No maintenance fees.|
|Ally Online Savings Account||1.10% ⇓||No minimum. No maintenance fees.|
|BMO Harris Bank Platinum Money Market Account||1.10% ⇓||$5,000 minimum. No maintenance fees.|
|Marcus by Goldman Sachs||1.05% ⇓||No minimum. No maintenance fees.|
|HSBC Direct Savings||1.01% ⇓||$1 minimum. No maintenance fees.|
|UFB Direct Money Market Account||1.00% ⇓||No monthly maintenance fees with a $5,000 balance, otherwise the fee is $10.00 per month.|
Minimum opening deposit of $5,000.$25,000 minimum to earn the highest interest rate.
|Citizens Access Online Savings Account||1.00% ⇓||$5,000 minimum. No maintenance fees.|
|CIT Bank Savings Builder||0.95% ⇓||$100 minimum to open an account plus, $100 minimum single deposit per month to earn the highest interest rate.Get up to $300 bonus when you open an account.|
Alternative Options to Savings and Money Market Accounts
In addition to high yield savings accounts and money market accounts, here are some alternatives that may work for you:
|Certificates of Deposit: Another option to high-interest savings is certificates of deposit. There are CDs with a term as short as 3 months and as long as 10 years. Generally, longer-term CDs pay more than savings but require a long-term commitment.|
|High Yield Checking Accounts: Generally, there are more restrictions around high yield checking to be eligible for the best rate. However, it may be worthwhile if you can meet the requirements.|
|Lending Club and Prosper||Lending Club and Prosper are social lending sites where you can invest in 3-year and 5-year loans with as little as $25 per loan. The interest rate you earn depends on the quality of the loan (based on borrower’s credit rating, loan amount, loan length, etc.) Currently, Lending Club claims “Our 11-year track record represents average historical returns of 4–8% per year” and Prosper claims “Historical Returns of 5.3% on average”.|
IMPORTANT: Please note that there are unique risks associated with social lending.
|Discount Brokers: Many discount brokers offer a money market account that acts as the default account for funds deposited into your brokerage account. It usually pays some interest (not as high as an online savings account), but a brokerage account also gives you access to other investment opportunities, e.g., income investing in dividend-paying stocks.|
If you know a bank that offers a higher rate than the ones above, we’d love your insight in the comments.
Frequently Asked Questions and Answers
What is the best way to choose a savings account?
When selecting a savings account, determine the features that are most important to you. For example, you may order the features as follows: high-interest rates, excellent customer service, low fees, and a good reputation.
Are online savings accounts better than a traditional one?
Online savings accounts are more popular each day. Typically, you have to complete most of your transactions online or using the ATM, since there may not be brick and mortar locations in the “real” world. In exchange, you enjoy a higher interest rate than average and pay lower fees.
How does FDIC insurance protect savings accounts?
When selecting a bank, make sure that it is FDIC insured. The federal government offers this insurance to participating banks, and it protects your money (up to $250,000 per depositor at each banking institution) against loss if the bank goes out of business.
What does the FDIC deposit insurance cover?
FDIC insurance covers all deposit accounts, including savings accounts, money market accounts, certificates of deposit (CDs), and checking accounts.
Please review the information associated with each offer before you sign up. Rates and conditions change constantly, and I have reported what I believe to be the most accurate information at the time the article was updated.
Pinyo Bhulipongsanon is the owner of Moolanomy Personal Finance and a Realtor® licensed in Virginia and Maryland. Over the past 20 years, Pinyo has enjoyed a diverse career as an investor, entrepreneur, business executive, educator, financial literacy author, and Realtor®.