Interest rates on savings accounts have been falling since the Federal Reserve started lowering the federal funds rate last summer. They continue to march downward in the wake of the Fed's March rate cuts (the federal funds rate is now down to zero), which were made in response to the coronavirus crisis. Savers searching for top yields should look to online banks, which offer significantly higher rates than brick-and-mortar institutions. At www.depositaccounts.com (opens in new tab), you can see the best interest rates available in your area based on the type of account you'd like to open and the amount you intend to deposit.
Among savings accounts, consider the SFGI Direct Savings Account (www.sfgidirect.com (opens in new tab)), which recently yielded 1.86%. It's noteworthy for having a long history of strong rates, says Ken Tumin of DepositAccounts.com. The savings accounts from Live Oak Bank (www.liveoakbank.com (opens in new tab)), yielding 1.75%, and PurePoint Financial (www.purepoint.com (opens in new tab)), yielding 1.50% on a $10,000 minimum balance, have also had outstanding yields over the past few years.
Some high-yield checking accounts offer better rates than savings accounts—but you have to jump through hoops. The Consumers Credit Union (Illinois) Rewards Checking account (www.myconsumers.org (opens in new tab); pay a $5 fee to the Consumers Cooperative Association to join) yields up to 5.09% on balances of up to $10,000 if you meet certain requirements, such as using your debit card 12 times monthly (purchases must total at least $100), having direct deposits of at least $500 and surpassing spending minimums on one of the credit union's credit cards.
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