What is the average savings account interest rate?
The average savings account interest rate is 0.46% APY, according to the latest data from the Federal Deposit Insurance Corporation (FDIC).
Many online banks offer interest rates much higher than this national average, with some offering as much as 5% APY. There is even the potential for 7% interest savings accounts, although that rate is not typical for savings accounts at present.
You can see some of the top-rated banks and their savings account interest rates below.
Bank |
APY |
Monthly fee |
Minimum opening deposit |
Withdrawal limits |
Synchrony |
4.30% |
$0 |
$0 |
- $1,000 per day - No limit on the number of times |
Ally Bank |
4.00% |
$0 |
$0 |
10 withdrawals per month |
American Express |
4.10% |
$0 |
$0 |
- 9 withdrawals per month - To transfer money in and out, you need to link the savings account to a separate checking account |
Marcus |
4.25% |
$0 |
$0 |
No withdrawal limit |
Barclays |
4.20% |
$0 |
$0 |
- Withdrawal limit of $250,000 per transaction - No limit on the number of times |
Capital One |
4.10% |
$0 |
$0 |
No withdrawal limit |
Citibank |
4.30% |
$4.50 |
$0 |
No withdrawal limit |
PNC |
4.45% |
$0 |
$0 |
Monthly withdrawal cap of 6 transactions |
Average savings account interest rates over time
The average interest rate can shift significantly in just a matter of months — from November 2023 to August 2024, the average rate rose by 40% from 0.33% APY to 0.46% APY.
Let’s take a look at historical patterns for interest rates to help you understand how rates fluctuate and what circumstances could affect how much your nest egg earns.
Savings account interest rates before 2008
Interest hit a historic high point in the 1980s when savings account rates peaked at a whopping 8%. Those rates were unsustainable, resulting in APY plummeting in the 90s to the 4% to 5% rates we’re more familiar with now.
We then saw a middle ground in the 2000s, with average rates closer to 1% to 2%.
Savings account interest rates from 2008 onwards
In 2008, a huge economic downturn led to some of the biggest financial instability since the Great Depression. The U.S. Federal Reserve slashed interest rates to encourage borrowing and boost economic activity, and savings account interest rates dipped as low as 0.25%.
Interest rates steadily continued to decrease during the years that followed until they bottomed out at a mere 0.06% APY in 2013, maintaining this level through 2017.
Interest rates then began to rise in 2018 with economic improvements, but the COVID-19 pandemic caused a brief recession and rates were pushed back down. By 2021, the average savings account interest rate had fallen to 0.05%.
In 2022, the Federal Reserve started raising rates due to high inflation. Rates then experienced a significant period of growth until reaching the current average savings account rate of 0.46%.
How average savings account interest rates are calculated
To calculate the average savings account interest rate, we use data from the Federal Deposit Insurance Corporation (FDIC). This government agency monitors savings account interest rates across the country and updates their data each month.
This agency also provides insurance for the money you deposit in a bank to safeguard it in case the bank shuts down.
What affects the average savings account interest rate?
Interest rates ebb and flow along with connected factors that heavily influence how much you’ll get (or, in the cases of other assets, like loans and mortgages, how much you’ll pay).
Economic conditions
The Federal Reserve affects the average interest rate for savings accounts by raising rates when the economy is artificially inflated and lowering rates to bring a sluggish economy back to life. This helps stabilize financial markets in the United States and catalyze consumers into buying, saving or some combination of the two.
Federal Reserve policies
The Federal Reserve is the central bank for the United States. As such, it has the power to set the country’s benchmark interest rate. All other banks then respond by aligning their in-house savings account interest rates accordingly. It’s kind of like a game of follow the leader — the Fed bumps up the benchmark interest rate for savings accounts, and banks raise their own rates to keep a level playing field.
Competition among banks
Banks are always fighting for customers, hence all the ads we see touting tempting welcome bonuses and promises of fee-free deposits and withdrawals. Interest rates are another dangling carrot. One bank doesn’t want to be the only institution on the market with interest rates far below the national average. So, if the Fed raises rates, many banks will toe the line and raise their rates as well to stay competitive.
Some banks may even go above and beyond, with interest rates well above those advertised by the competition. This tends to happen more with online-only banks that offer low or no-fee accounts with sky-high interest. Their lack of overhead (no brick-and-mortar locations, for starters) gives them better margins and more wiggle room.
What is a good rate for a savings account?
Understanding the average interest on savings accounts and what interest rate is “good” might involve two separate (but linked) discussions. The average interest rate in the United States, per the FDIC, is 0.46%. But that’s far below what experts believe to be a solid, favorable rate.
Truthfully, you have to look at interest rates through two lenses:
So, a “good” interest rate seems to be one over 4% APY, but only if you’re comfortable with online banking. If you prefer to bank in person and visit physical branches to manage your account or speak with a customer service agent, you may have to settle for a less-than-stellar interest rate in exchange.
How to get the best savings account interest rate
To get the best savings account interest rate for your needs, consider the following:
Alternatives to savings accounts
If you can’t find a savings account that ticks all your boxes, some alternatives can help you save money and maximize your ROI.
You may want to check out these other options:
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Checking accounts: Checking accounts are also called transaction accounts because they’re designed to accommodate frequent deposits and withdrawals. These accounts are set up for everyday use for individuals. Business owners can set up business checking accounts to separate business expenses from personal finances. You deposit money on payday, spend using your debit card and withdraw money at ATMs. While checking accounts don’t typically bear interest, some banks with the best checking accounts now do — just read the fine print for “catches,” like high minimum opening deposit or monthly balance requirements.
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Certificates of deposit (CDs): Certificates of deposit lock your money up in a nontransactional account for whatever term you agree to. The CD safeguards your money for anywhere from several months to ten years or longer in exchange for high interest rates. You cannot withdraw money until the CD matures without incurring a penalty.
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Money market accounts: Money market accounts blend the best features of checking and savings accounts. You can deposit and withdraw money (though there are often transaction limits), and you earn interest on whatever money you leave in the account. Keep an eye out for specific requirements (e.g., high minimum balance requirements and/or lots of fees).