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The Best CD Rates – July 2020

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If you’re looking for a better yield on your savings and have time to burn, a high-rate CD at an online bank would be a great option. With a CD, you agree to lock up your funds in an account for a specific period of time, and in return the bank offers a higher yield than you’d find on a standard savings account. If you’re not keen on the idea of completely locking your money away for a set amount of time, you may want to consider a no-penalty CD. These accounts give you the benefit of locking down a rate for a set amount of time without requiring you to lock in your money for the length of the term.

CDs are often seen as the next level up after savings for that reason. If you’ve maxed out your savings account with enough funds to see you through the next year or so, it can be wise to start shoveling savings into a CD to maximize your returns.

For the best CD rates in the industry, check out online banks. They tend to offer much better interest rates than traditional banks, thanks to the lack of typical brick-and-mortar costs.

For example, let’s say you find a 12-month CD at a big brick-and-mortar bank that requires a $1,000 minimum deposit and pays 0.05% APY. If you were to open that account with just the minimum, you’d earn 50 cents after a year. Even a bigger deposit of $10,000 would only yield $5 at maturity.

At an online bank, on the other hand, you could earn 2.80% often with a minimum deposit of $1,000. Opening the account with $1,000 would yield $28, while a $10,000 deposit would earn $280 in a year, a much better return on your money no matter how you look at it. (If you would rather get a savings account or money market with no time restriction, look at the best savings accounts or best money market accounts).

Check out MagnifyMoney’s top picks for the best CD rates below.

Do you have a savings goal in mind? Tell us about it!

The best CD rates for July 2020

To find the best CD rates, we look for the banks that consistently offer competitive CD rates month over month. This list is updated weekly and the rates are organized by 1-year rates from highest to lowest. Here are the accounts from top banks with consistently competitive CD rates:

6 months – 6 years: Marcus by Goldman Sachs – 0.60% APY – 1.15% APY; $500 minimum deposit to open

High-yield 12 Month CD from Marcus by Goldman Sachs

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Our advertiser Marcus by Goldman Sachs is the online consumer bank of Goldman Sachs (the large investment bank). Your funds are FDIC insured, and Goldman offers very competitive annual percentage yields (accurate as of 7/9/20). Even better: there is only a $500 minimum deposit. So, if you don’t have enough money to meet the minimum deposit of the other banks on this list, or you are looking for another bank for your savings, GS is a good option. It also doesn’t hurt that they also offer some of the best CD rates in the market today. Here are their rates:

Term

APY

Minimum Deposit Amount

6 months

0.60%

$500

9 months

0.70%

$500

12 months

1.10%

$500

18 months

1.10%

$500

24 months

1.10%

$500

3 years

1.10%

$500

4 years

1.10%

$500

5 years

1.15%

$500

6 years

1.15%

$500

3 months – 5 years: Ally Bank – 0.50% APY – 1.15% APY; $0 minimum deposit to open (higher APY with higher deposit)

12 Month High Yield CD from Ally Bank

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Member FDIC

Ally is one of the largest internet-only banks in the country. Ally’s former advertising campaign made it very clear: no branches = higher rates. And Ally has consistently paid some of the highest rates in the country across savings accounts, money market accounts and CDs. For savers with fewer funds, Ally is unique. There is no minimum deposit to open a CD. However, if you have more money, you’ll earn more in interest and in some cases, earn a higher APY. And one of our favorite features of Ally: they often (although not always) offer preferential rates on renewal. Far too often banks give the biggest bonuses to new customers, but Ally has done a good job of rewarding its existing customers. All deposits at Ally are FDIC insured up to the legal limit.

3-months:
  • 0.50% APY (less than $5k)
  • 0.50% APY ($5k minimum deposit)
  • 0.50% APY ($25k minimum deposit)
18-months:
  • 1.05% APY (less than $5k)
  • 1.05% APY ($5k minimum deposit)
  • 1.05% APY ($25k minimum deposit)
6-months:
  • 0.65% APY (less than $5k)
  • 0.65% APY ($5k minimum deposit)
  • 0.65% APY ($25k minimum deposit)
3-year:
  • 1.05% APY (less than $5k)
  • 1.05% APY ($5k minimum deposit)
  • 1.05% APY ($25k minimum deposit)
9-months:
  • 0.75% APY (less than $5k)
  • 0.75% APY ($5k minimum deposit)
  • 0.75% APY ($25k minimum deposit)
5-year:
  • 1.15% APY (less than $5k)
  • 1.15% APY ($5k minimum deposit)
  • 1.15% APY ($25k minimum deposit)
12-months:
  • 1.00% APY (less than $5k)
  • 1.00% APY ($5k minimum deposit)
  • 1.00% APY ($25k minimum deposit)
3 months – 10 years: Discover Bank – 0.25% APY – 1.15% APY, $2,500 minimum deposit to open

12 Month CD from Discover Bank

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Discover Bank's website is secure

Discover is best known for cash back credit cards. However, Discover has also quietly built a leading internet bank that offers checking accounts, savings accounts and CDs. Discover has invested in a mobile banking app and strong on-shore customer service.Although Discover does not always have the highest rate, it is very close (within basis points) across all durations. If customer service and digital tools (like apps) are important to you, Discover is an excellent consideration. Note: you can even get a CD rate with a duration as short as 3 months. However, you would be better off opening a high yield savings account if you plan on saving the money for less than a year.Keep in mind that all CD terms come with an early withdrawal penalty if you choose to withdraw money before your maturity date. If your Discover CD is less than one year, the penalty is worth three months of simple interest. If the term is between one to three years, the penalty is worth six months of simple interest. Four-year CDs have a penalty that is worth nine months of simple interest. Five year CDs have a penalty that is worth 18 months of simple interest and seven to 10-year CDs have a penalty that is worth 24 months of simple interest.

CD TermAPY
3-months0.25%
6-months0.45%
9-months0.55%
12-months0.90%
18-months0.90%
2-year1.01%
30-months1.05%
3-year1.05%
4-year1.10%
5-year1.15%
7-year1.15%
10-year1.15%
1 year – 5 years: Citizens Access – 0.85% APY – 1.00% APY; $5000 minimum deposit to open

Online 1 Year CD from Citizens Access

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Member FDIC

Citizens Access is the online division of Citizens Bank, N.A., aimed at providing more convenient access to better banking products. Both divisions are headquartered in Providence, R.I. Citizens Bank was founded in 1828 and as of September 2019, had $150 billion in assets.Citizens Access’ online CD accounts require a pretty high opening deposit of $5,000. However, all its terms earn at premium rates, making your savings more worthwhile. Citizens Access also offers an easy opening process to build a CD ladder with them. You’ll need to deposit at least $5,000 in each new CD, though.

When you fund any new Citizens Access CD within 10 days after opening, the bank’s CD Rate Pledge will apply, snagging you the highest interest rate offered by the bank for that CD term within those 10 days. Here are their rates:

CD TermAPY
12 months0.85%
18 months2.10%
2 years0.85%
3 years0.90%
4 years0.95%
5 years1.00%
1 year – 5 years: Barclays Bank – 0.85%0.85% APY, no minimum deposit to open
Barclays is one of the oldest banks in the world. Although they’re based in London, they do have a U.S. presence and offer competitive rates on their CDs and savings account. Currently, they’re offering some of the highest CD rates in the market, and they have an edge over the rest of the institutions on this list: they don’t require a minimum balance to earn the APY or open an account. Deposit as little or as much as you’d like into a term of your choice and you can start earning interest as long as the account is funded within 14 days of opening the CD. Additionally, your funds are insured through the FDIC.

CD TermAPY
1-year0.85%
2-year0.85%
3-year0.85%
4-year0.85%
5-year0.85%
90 days – 5 years: BankDirect – 0.45% APY – 0.25% APY; $10,000 minimum deposit to open

12 Month CD from BankDirect

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Online bank BankDirect offers a wide range of CDs, varying in term length from 90 days to five years. Currently, its 1-year CD boasts a competitive APY of 1.11%. However, there is a hefty minimum deposit of $10,000 required for this product.

BankDirect is the online division of Texas Capital Bank. It offers an array of banking products to consumers online, nationwide.

TermAPY
90 days0.45%
6 months1.00%
12 months1.11%
18 months1.21%
24 months1.26%
30 months0.50%
36 months0.50%
48 months0.25%
60 months0.25%
1 Years – 5 years: Quontic Bank – APY – 1.28% APY; $500 minimum deposit to open

12 Month CD from Quontic Bank

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Member FDIC

Online bank Quontic Bank offers a wide range of CDs, with term lengths from one year to five years. Currently, its 1-year CD doles out an APY of 1.02%, although its crown jewel is its 5-year CD, which has a high APY of 1.28%. There is a minimum deposit of $500 required for this product.

CD TermAPY
1-year
3-year1.17%
5-year1.28%
3 Months – 5 years: TIAA Bank – 0.35% APY – 1.35% APY; $5,000 minimum deposit to open

1 Year CD from TIAA Bank

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TIAA Bank's website is secure

TIAA Bank offers a wide selection of CD products, ranging in term length from three months to five years. Currently, its 1-year Yield Pledge CD is doling out a generous APY of 1.01% with a minimum deposit of $5,000. There are no monthly account fees associated with this CD.

CD TermAPY
6 Month CD0.50%
9 Month CD0.65%
1 Year CD0.76%
2 Year CD0.85%
3 Year CD0.96%
5 Year CD1.10%
3 months – 5 years: First Internet Bank – 0.30% APY – 1.31% APY; $1,000 minimum deposit to open

12 Month CD from First Internet Bank

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Member FDIC

First Internet Bank of America boasts a robust rate of 1.41% APY on its 12-month CD, making it one of the best 1-year CDs currently offered. There is a minimum deposit of just $1,000 required for this account, and there is no monthly maintenance fee.

First Internet Bank has roots dating back to 1999, and it claims to be the first FDIC-insured institution to operate entirely online.

CD TermAPY

3-month CD

0.30%

6-month CD

0.65%

1-year CD

1.01%

18-month CD

1.06%

2-year CD

1.11%

3-year CD

1.16%

4-year CD

1.21%

5-year CD

1.31%

The best no-penalty CD rates

No-penalty CDs are unique because these accounts allow customers to withdraw from their CD without incurring an early withdrawal penalty. These CDs are an attractive offer to customers as it provides no risk if they choose to withdraw their money early. Here are some of the best no-penalty CD rates that are available nationwide:

7 months – 13 months: Marcus by Goldman Sachs – 1.00% APY – 0.80% APY; $500 minimum deposit to open

7 Month No-Penalty CD from Marcus by Goldman Sachs

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Similar to its regular CDs, you only need a minimum of $500 to deposit into Marcus Goldman Sachs’ no-penalty CDs. This makes these CDs highly attractive to customers with smaller deposits. If you choose to open one of these CDs, you’ll only be locked in for seven days after you fund the account. After the seventh day, you’re free to withdraw your funds, but keep in mind that you’ll need to withdraw the full amount.

These CDs are an excellent option if you want your money to remain liquid or if you want to invest your money into an interest-earning account for a short amount of time. One thing to note is that the 7-month no-penalty CD has a much higher rate than the regular 6-month CD (1.00% APY vs 0.60% APY). The high APY makes Goldman’s 7-month no-penalty CD a fantastic option if you want to earn interest in a short amount of time. Here is Goldman’s full list of no-penalty CD rates:

TermAPYMinimum balance to earn the APY
7-month1.00%
$500
11-month0.90%
$500
13-month0.80%
$500
11 months: Ally Bank – 0.95% APY – 0.95% APY; $0 – $25,000 minimum deposit to earn APY

No Penalty 11 Month CD from Ally Bank

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Unlike the other two banks that offer multiple terms, Ally Bank only offers one term on its no-penalty CD. While Ally doesn’t require a minimum deposit to open, it does reward higher balances with higher APYs. This no-penalty CD is great for low-balance individuals who want to keep their money liquid. However, if you’re okay with locking your money into a CD for 12 months, you’re better off going with Ally’s regular 12-month CD as it has a higher APY (1.00% APY vs 0.95% APY) and doesn’t have a certain balance requirement to earn that high rate.

If you still choose to open Ally’s 11-month no-penalty CD and you need to withdraw money before the terms ends, you’ll need to withdraw your funds in full and won’t be able to do so until seven days after funding the account. Here are the tiered rates for Ally’s no-penalty CD:

TermAPYMinimum balance to earn the APY
11 months0.95%None
11 months – 14 months: PurePoint Financial – 0.50% APY – 0.45% APY; $10,000 minimum deposit to open

13 Month Online No-Penalty CD from PurePoint Financial

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PurePoint Financial is the online division of Union Bank. Both the parent bank and this online division are backed by financial giant, Mitsubishi UFJ Financial Group (MUFG). Under the MUFG Union Bank umbrella, this institution has acquired over $130 billion in assets. As its online division, PurePoint Financial has been able to offer its customers highly competitive rates not only in CDs, but in an online savings account.

Currently, PurePoint Financial is offering an extremely competitive rate of 0.45% on its 13-month no-penalty CD. It also offers an 11-month and a 14-month no-penalty CD, but those two accounts have lower rates than its 13-month no-penalty CD. Keep in mind that you’ll need at least $10,000 to deposit into any of these CDs. If you do choose to withdraw money from this CD before the term is up, you’ll need to withdraw the full amount. You’ll also have to wait seven days after you fund the account to withdraw any of the money. Here’s a full list of PurePoint Financial’s no-penalty CDs.

TermAPYMinimum balance to earn the APY
11-month0.50%$10,000
13-month0.45%$10,000
14-month0.40%$10,000
6 months: Investors eAccess – 0.40% APY; $500 minimum deposit to open

6 Month No Penalty CD from Investors eAccess

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Investors eAccess is the online division of Investors Bank, a large bank headquartered in New Jersey that was established in 1926. The parent bank currently has over $26 billion in assets. The online division was launched earlier this year and decided to introduce itself by offering a strong rate on its inaugural product, the eAccess Money Market account. It seems this online bank is slowly offering different deposit accounts, but one thing that sticks out is that it’s offering these new products with high rates.

Currently, Investors eAccess is offering two types of CDs: a 6-month No-Penalty CD and a 10-month regular CD. The 6-month No-Penalty CD is comes with a strong 0.40% APY. You need at least $500 to open the account and you’re free to withdraw from the principal amount after the first seven calendar days from opening the account without incurring any penalties. If you choose to withdraw the full amount (including any interest earned) before the maturity date, you won’t incur any penalties, but the full withdrawal will close the account. Regardless of how much you choose to withdraw from the account, the bank will send you the funds via an official Bank Check. The check will be made out to the account owner and mailed First Class to the address on file.

TermAPYMinimum balance to earn the APY
6-month0.40%$500

The highest CD rates from banks and credit unions by term

The following banks and credit unions are currently offering the highest CD rates for each term.

Best 1-year CD rates

Best 1-year CD rate from a Credit Union: Pen Air Federal Credit Union – 1.25% APY, $500 minimum balance

12 Month CD from Pen Air Federal Credit UnionPen Air Federal Credit Union offers a slew of certificates of deposit, with term lengths ranging from just three months to 60 months. Its 12-month CD is certainly worth highlighting, with its 1.35% APY. There is a minimum deposit of just $500 required for this account.

Membership to Pen Air Federal Credit Union is open to anyone who also joins the Friends of Navy-Marine Corps Relief Society. Although Pen Air only has physical locations in Florida and Alabama, it offers its products online, nationwide.


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NCUA Insured

Best 1-year CD rate from a National Bank: Limelight Bank– 1.00% APY, $1,000 minimum deposit

12 Month CD from Limelight BankThe online bank division of Capital Community Bank, LimeLight Bank offers a slew of CDs, ranging in term length from six months to 36 months. Its 1-year CD currently boasts a competitive rate of 1.00% APY, with a minimum deposit of $1,000. Like most CDs, there are penalties associated with early withdrawals from this account.


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on Limelight Bank’s secure website

Member FDIC

Best 2-year CD rates

Best 2-year CD rate from a Credit Union: Georgia’s Own Credit Union– 1.25% APY, $500 minimum deposit

2 Year CD from Georgia's Own Credit UnionGeorgia’s Own Credit Union offers certificates of deposit ranging in term length from six months to five years, but its sweet spot is its 2-year CD, which comes with a competitive APY of 1.45% on balances of $500 and up. Interest on this product is compounded quarterly.

While the credit union is based in Georgia, membership to Georgia’s Own Credit Union is open to anyone who joins Georgia’s Own Foundation or the Getting Ahead Association. Once approved, you are required to make a $5 minimum deposit to join.


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NCUA Insured

Best 2-year CD rate from a National Bank: Comenity Direct – 1.05% APY, $1,500 minimum deposit

2-Year CD from Comenity DirectComenity Direct is the internet-only arm of Comenity Capital Bank – a Utah-based bank with roots dating back to 1986. Comenity Direct offers an array of certificates of deposit, with term lengths of 1-year, 2-years, 3-years, 4-years and 5-years, all featuring attractive APYs.

There is a $1,500 required minimum deposit for all CDs. Comenity Direct charges no monthly maintenance fees on its CDs, although there is a $25 fee per outgoing wire transfer, $15 fee per paper check request and a $5 fee per paper statement request. Like most CDs, there are fees associated with early withdrawal. Once your CD matures, you can choose to automatically renew it or cash out without penalty within a 10-day grace period.
.


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on Comenity Direct’s secure website

Member FDIC

Best 3-year CD rates

Best 3-year CD rate from a Credit Union: Georgia’s Own Credit Union – 1.45% APY, $500 minimum deposit

3 Year CD from Georgia's Own Credit Union Georgia’s Own Credit Union offers certificates of deposit ranging in term length from six months to five years, but its sweet spot is its 3-year CD, which comes with a competitive APY of 1.45% on balances of $500 and up. Interest on this product is compounded quarterly.

While the credit union is based in Georgia, membership to Georgia’s Own Credit Union is open to anyone who joins Georgia’s Own Foundation or the Getting Ahead Association. Once approved, you are required to make a $5 minimum deposit to join.


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on Georgia's Own Credit Union’s secure website

NCUA Insured

Best 3-year CD rate from a National Bank: Synchrony Bank – 1.15% APY, $2,000 minimum deposit

36 Month CD from Synchrony BankA common rate-leader in the best rate climates, Synchrony Bank stands out now for its competitive 3-year CD rate in a rocky rate climate. Synchrony CDs require at least $2,000 to open. The penalty for an early withdrawal will equal 365 days of simple interest at the current rate at the time of withdrawal.
Known for its credit card business, Synchrony holds its own in the deposits space, too, with its consistently competitive deposit account rates. Synchrony CD customers can access their accounts online and on the Synchrony mobile app, but Synchrony also offers ATM access for its money market and savings account customers.


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on Synchrony Bank’s secure website

Member FDIC

Best 4-year CD rates

Best 4-year CD rate from a Credit Union: Hiway Federal Credit Union – 1.30% APY, $25,000 minimum deposit

48 – 59 Month CD from Hiway Federal Credit Union You’ll need a $25,000 minimum deposit to snag this top rate from Hiway Federal Credit Union. Smaller deposits as low as $500 will still earn interest, just at lower interest rates. The early withdrawal penalty for this range of CDs equals 365 days’ dividends.

Hiway Federal Credit Union was founded in 1931 to serve the financial needs of Minnesota Department of Transportation employees. Today, membership is extended to members of select communities, employees of select employer groups, relatives and roommates of eligible individuals and members of the Minnesota Recreation and Park Foundation or Association of the U.S. Army.


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on Hiway Federal Credit Union’s secure website

NCUA Insured

Best 4-year CD rate from a National Bank: Prime Alliance Bank– 1.25% APY, $500 minimum deposit

48 Month CD from Prime Alliance BankPrime Alliance Bank offers CDs ranging from 6 months to five years, but its sweet spot is its 4-year CD offering. Currently, Prime Alliance’s 4-year CD boasts a high APY of 1.25% and a low minimum deposit of just $500.

Prime Alliance was founded in 2004. With one branch in Woods Cross, Utah, the bank still offers its great accounts nationwide virtually.


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Member FDIC

Best 5-year CD rates

Best 5-year CD rate from a Credit Union: Generations Credit Union – 1.97% APY, $500 minimum deposit

60 Month CD from Generations Credit Union Generations Credit Union offers an array of certificates of deposit, but its 5-year CD is currently one of the best of its kind, with an APY of1.97%. For this CD, there is a required minimum deposit of $500. While balances up to $49,999 will garner the 1.97% APY, balances of over $50,000 will reap an even higher APY of 2.12%.

Established in 1939, Generations Credit Union is based in Washington. Membership to Generations is open to anyone who also joins the Northwest Energy Coalition and the Northwest Credit Union Foundation, regardless of where they live.


Best 5-year CD rate from a National Bank: Federal Savings Bank – 1.35% APY, $500 minimum deposit

5 Year Promotional CD - New Money from The Federal Savings Bank The Federal Savings Bank is currently featuring a 1.35% APY for its 5-year CD. There is a low minimum deposit of $500 for this product.

The Federal Savings Bank is a veteran-owned, federally-chartered bank. While the bank only has locations in Illinois, it offers its products nationwide, online.


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Member FDIC

The cities that are most likely to use CDs for their savings

We recently looked at the 100 largest U.S. metros to find the cities with the highest percentage of households that own certificates of deposit.

Among the 100 largest U.S. metros, San Francisco came out on top, with 25.4% of households owning certificates of deposit. That’s more a little more than twice as many households, on a percentage basis, than Greensboro, N.C., our bottom-ranked city, where only 12.5% of households own CDs.

Typically, households in large cities are more likely to sock money away in CDs. Chicago, Los Angeles, New York and Washington, D.C. — among the 10 largest metros in the U.S. — all make our list of top 10 cities where people own CDs. There are some exceptions: Odgen, Utah ranks No. 4 in the nation for CD saving: 21.9% of Ogden households have CDs.

Variability in local CD rates may explain some of the differences, as the highest rates available by state can vary by as much as one percentage point. In fact, in Jan. 2019, Utah had the highest average local 1-year CD yield in the country.

Questions to ask before you open a CD

1. How are CDs different from savings accounts?

With a CD, the saver and the bank make stronger commitments. The saver promises to keep the funds in the account for a specified period of time. In exchange, the bank guarantees the interest rate during the term of the CD. The longer the term, the higher the rate – and the higher the penalty for closing the CD early. With a savings account, you’re limited to six withdrawals or transfers per month. Otherwise, you can empty the account at any time without paying a penalty. You can’t lock in the interest rate on a savings account, though, since the bank can change the interest rate at any time.

2. Am I better off keeping my cash in savings?

CDs work best if you’re confident you won’t need to access a certain amount of money for a specified period of time. Let’s say you have $10,000 laying around that you can safely say you won’t need to use for two years. In a high-yield savings account earning 2.45%, you would earn $496.00 over two years with annual interest compounding — and potentially even more, if your bank compounds interest more frequently. If you put that money into a 2.90% 2-year CD, you would earn $588.41 (compounding yearly) once the account matures. The extra interest income is easy money, considering the ease of opening an account online. However, if you think you might need to use the money in the next couple of months, especially if your finances are already a little rocky, a savings account is a much better idea for its better flexibility.

It’s important to note that deposit rates are a bit in flux right now, due to the uncertainty surrounding the federal funds rate (more on that below). But we’re currently seeing some high, favorable interest rates on 1-year CDs, rates that outstrip savings account rates.

If you can afford to part with the funds, “choosing a 1-year CD now does make sense rather than keeping the money in a savings account,” says Ken Tumin, founder of LendingTree-owned DepositAccounts.com. “However, it is possible that 1-year rates could go below some savings account rates.”

That’s why it’s important to compare rates before you sign up for a certain account.

Tumin also notes that there is an added tax benefit to opening a 1-year CD now over a savings account. With a 1-year CD, you can choose to have interest paid at maturity, or in 2020 on accounts opened now. Taxes would be owed on that interest for 2020, but not paid until 2021. Savings accounts, on the other hand, pay out interest each month. So a savings account opened today will generate interest income for the 2019 tax year.

3. What CD term length should I select?

The early withdrawal penalties on CDs can be significant. On a 1-year CD, 90 days’ worth of interest is a typical penalty, although it can reach as high as 180 days. On 2- and 3-year CDs, a 6-month penalty is about average. The impact of the penalty on your return can be significant: if you opened a one-year CD with a 2.65% APY and closed it after six months, you would forfeit half of the interest and earn only 1.32%. You would have been better off with a savings account paying 2.25%.

The worst case scenario is with the longest CDs. 5-year CDs usually have a one-year penalty for taking out funds early. If you open a 5-year CD and close it quickly, you could actually end up losing money.

Given the risk of early withdrawal penalties, it’s important that you’re completely confident that you will not need to withdraw the money early. Check that you already have enough savings in a flexible emergency fund to cover you for the next few years in the event of an accident or surprise trip to urgent care. Ask yourself whether your deposit would be put to better use paying off any debts. If you’re not completely convinced you can sock away that much money for such a commitment, go for a shorter CD term or a savings account.

As of right now, if you’re trying to jump on the best rates and have cash to stash away for years, your best bet is to lock in a 5-year CD to get the best rates possible.

“It doesn’t look like we’ll see another Fed rate hike in the first half of the year,” says Ken Tumin. “In the last month or two, we’re seeing some drops in CD rates.”

However, this downward movement looks like more of a correction being made by banks who may have boosted their CD rates too far too fast, instead of signaling the start of an industry-wide drop in rates.

“We won’t see a big drop until we see signs that the Fed will start cutting rates,” Tumin notes.

Tumin suggests finding long-term CDs with small or mild withdrawal penalties, like Ally. That way, in the event you do need to break into your funds (whether for an emergency or to move to a new, higher rate), you won’t lose the majority of your savings. So while there are still 5-year CDs out there with 3% APY and higher, you’re going to want to lock those in for the long term.

4. Should I consider my local bank or credit union?

The interest rates shown in this article are all from credit unions and online banks that offer products nationally. However, our product database includes traditional banks, community banks and credit unions.

If traditional banks offered better rates, they would have been featured in this article. Internet-only banks have dramatically better interest rates. That should not be surprising — because internet-only banks do not have branches, they are able to pass along their cost savings to you in the form of higher interest rates and lower fees.

If you’re worried about early withdrawal penalties, credit union CDs might be your best bet; on average, they tend to have lower penalties than banks. Pair that with high credit union CD rates, and you’ve got a winning savings combo. (Interestingly, while internet banks tend to offer the best CD rates, they also tend to assess bigger early withdrawal penalties than brick-and-mortar banks.)

How to find the best CD for you

If you don’t find an account that meets your needs in this article, you can use the MagnifyMoney CD tool to find the best rate for your individual needs. Input your zip code, deposit amount and term. The tool will then provide you with CD options, from the highest APY to the lowest.

Even though CDs are traditionally pretty structured, you still have hundreds of options available to you. If your savings goal is years in the future, look closer at longer terms like 5- and even 10-year accounts. If you don’t quite have thousands of dollars to stash away, you can find a bank that requires a lower minimum deposit, if at all. You can also find select no-penalty CDs, which tend to be around one year long or less.

You can learn more about us and how we make money here.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

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Best of, Earning Interest

The Best High-Yield Online Savings Accounts in July 2020

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It may not have been previewed, commissioned or otherwise endorsed by any of our network partners.

Written By

 

Reviewed By

There are no excuses for sticking with a low-rate savings account these days. High-yield savings accounts provide consumers with interest rates that are way above those offered by conventional banks. The best high-yield online savings accounts can easily earn you an APY of 1.05% or greater, while the average rate offered by a traditional brick-and-mortar bank remains at a paltry 0.06%.

If you’re still skeptical about switching to an online bank, consider the facts. Your funds are just as safe stashed with an FDIC-insured online bank as they would be with the bank branch on Main Street, and you’re likely to get better technical support with an online-only bank website and app. Many offer round-the-clock customer support and online chat features that make it easy to resolve issues without needing to visit a branch in person. Along with higher rates, you may end up saving on the cost of the account. With lower overhead costs, online banks typically charge lower fees.

Every month we review and compile the best high-yield savings account offers from online banks. Our ranking factors in features such as a higher-than-average interest rate, no minimum balance requirement, and superior ATM access.

Market update: Banks have dropped their savings rates considerably due to recent uncertainty caused by the COVID-19 outbreak. Despite interest rates declining overall, we are still seeing many of the pre-crisis top performers continuing to lead the pack in the overall best rates category.

  • 1.05% APY –  Marcus by Goldman Sachs
  • 1.05% APY – Synchrony Bank
  • 1.00% APY – American Express National Bank
  • 1.00% APY – Capital One
  • 1.00% APY – Ally Bank
  • 1.00% APY – Barclays Bank
  • 1.11% APY – Vio Bank
  • 1.10% APY – Axos Bank
  • 1.01% APY – HSBC Direct
  • 1.00% APY – Live Oak Bank
  • 1.00% APY – Citizens Access
  • 0.95% APY – BrioDirect
  • 1.20% APY – Fitness Bank
  • 1.20% APY – First Foundation Bank
  • 1.16% APY – SFGI Direct
  • 1.05% APY – Popular Direct
  • 1.00% APY – Comenity Direct
  • 1.00% APY – Rising Bank
  • 1.00% APY – UFB Direct
  • 6.17% APY – Digital Federal Credit Union

Do you have a savings goal in mind? Tell us about it!

1. High Rate: Marcus by Goldman Sachs – 1.05% APY, no minimum balance (but no ATM access)

High-yield Online Savings Account from Marcus by Goldman Sachs

Our advertiser Marcus by Goldman Sachs, the consumer bank of Wall Street giant Goldman Sachs, offers a 1.05% Annual Percentage Yield on deposits, accurate as of 7/13/2020. There isn’t a minimum balance requirement to earn the APY and there are no transaction fees. Upon opening the account, you can deposit funds via electronic transfer, wire transfer, or deposit by check. You can get access to your funds via electronic transfer or wire transfer.

Goldman has been investing heavily in Marcus, its online consumer bank. Marcus is already offering some of the best savings accounts and personal loans in the market, and further expansion is expected. The savings account has consistently been paying one of the highest rates in the market. With a 1.05% APY, you can get one of the highest rates in the market from a well-known brand. The maximum deposit is $1,000,000 and deposits are FDIC insured up to the $250,000 limit.

Marcus is accessible both online and via the Marcus mobile app, available only in the Apple App Store.

SEE DETAILS Secured

on Marcus By Goldman Sachs’s secure website

Member FDIC

2. High Rate: Synchrony Bank – 1.05% APY, no minimum balance, (and ATM access)

High Yield Savings from Synchrony BankSynchrony Bank pays a healthy 1.05% APY. There is no minimum balance requirement and no monthly fee. In addition to the great rate, you can get an ATM card. Most internet-only banks require you to transfer funds electronically, which can take a few days. If you ever need quick access to your funds, the ATM card makes access easy. You might not recognize the Synchrony brand in the banking space, but it is a large, well-capitalized business. Synchrony used to be a part of General Electric (GE), and was spun out as a separate company. Unfortunately, the digital experience is not the best, but they now have a mobile banking app.

3. High Rate: American Express National Bank – 1.00% APY, no minimum balance (and no fees)

High Yield Savings Account from American Express National BankOur sponsored advertiser, American Express National Bank, offers a Personal Savings account, which earns a 1.00% variable Annual Percentage Yield (APY) as of 7/13/2020. The account charges no monthly fees and requires no minimum deposit, making it an affordable account to open. You must fund your account within 60 days of applying for the account, and the FDIC insures your deposits up to $250,000. Overall, the account is a great option for anyone who wants the flexibility of earning a high interest rate on a sum of money you’ve stashed away, minus the withdrawal restrictions of a certificate deposit.

SEE DETAILS Secured

on American Express National Bank’s secure website

Partner Offer

Member FDIC

4. High Rate: Capital One – 1.00% APY, no minimum balance

360 Performance Savings from Capital OneA consistent rate leader for its deposit accounts, Capital One now offers its 360 Performance Savings. With a 1.00% APY on all balances and no monthly fee, you get a chance to boost your savings uninterrupted. There are no minimum balances required to open or maintain the account, either.

Capital One is able to offer higher rates and lower (to no!) fees on this online savings account compared to traditional in-branch offerings. Still, you can head to a Capital One branch or Capital One Café to open a new 360 Performance Savings account, if you prefer. You cannot use an ATM to withdraw or deposit funds, but you can visit a branch, call the bank or make your own online transfer. You can access all accounts on your mobile device through the Capital One app, as well.

5. Favorite Online Package: Ally Bank – 1.00% APY, no minimum balance and you can get a free checking account

Online Savings Account from Ally BankAlly is a bank without branches that had been consistently paying high interest rates on savings accounts. While Ally is still offering rates way above what brick-and-mortar banks are offering, it seems this online bank no longer wants to be seen as the online bank with the most competitive rates. The current APY on Ally’s savings account is 1.00%. Although Ally has dropped its rate significantly, we still favor this online bank. It doesn’t require a minimum balance to earn the APY and, even better, you can open a free checking account (also with no minimum balance requirement). This makes access to your savings account incredibly easy – because you can transfer funds online (or via the app) and have immediate access via checks, debit cards and ATMs. With an Ally account, you will have access to their full suite of expanding (and market-leading) products such as CDs, money market account, checking account, and IRA accounts.

SEE DETAILS Secured

on Ally Bank’s secure website

Member FDIC

6. High Rate: Barclays Bank – 1.00% APY, no minimum balance

Online Savings Account from BarclaysBarclays is a large, old British bank, based in London and with more than 325 years of history. Although Barclays is huge in the United Kingdom, it is a challenger brand in the US. Barclays offers savings products with highly competitive rates. These deposits are used to fund their rapidly growing American credit card business. The online savings account has a 1.00% APY with no minimum balance to open and no monthly fees. Your deposits are FDIC insured up to the legal limit. The Barclays website has a good look and feel. And you can have the confidence of keeping your money with one of the world’s largest and oldest universal banks.

SEE DETAILS Secured

on Barclays’s secure website

Member FDIC

7. High Rate: Vio Bank – 1.11% APY, $100 to open

High Yield Online Savings Account from Vio BankVio Bank is the online division of MidFirst Bank, a national private financial institution with over $16 billion in assets. Vio Bank was recently created and is not yet as established as Marcus, Barclays, American Express, Synchrony, and Ally Bank. However, this online bank launched its High Yield Online Savings account with a strong APY (at the time of its launch) and has been consistently competitive since it launched. It’s currently offering an outstanding 1.11% APY on all balances. You only need $100 to open the account. You can fund the account via ACH.

There are a few limitations to keep in mind: incoming ACHs take anywhere between two to five business days to post and the online bank may place a hold your ACH for two or three business days. When you’re ready to transfer funds out of the account, you’ll be limited to $5,000 per outgoing ACH. You’ll also be limited to transferring an aggregate monthly total of $20,000 via outgoing ACHs. As is with every other savings account, you’ll also be limited to making six withdrawals per monthly statement cycle. The good news (aside from the high APY) is that Vio Bank doesn’t charge a monthly maintenance fee. Vio Bank also has a mobile banking app where you can conveniently manage your accounts on-the-go. Also, its website is mobile friendly so it should be fairly easy to do your online banking from a smart phone, as well. We think this online bank is very promising and hope it continues to offer one of the best savings account rates in the nation.

SEE DETAILS Secured

on Vio Bank’s secure website

Member FDIC

8. High Rate: Axos Bank – 1.10% APY, $250 to open

High Yield Savings from Axos Bank
Axos Bank was founded in 2000, known then as Bank of Internet USA. Through a couple name changes, Axos Bank has remained one of the top online banks. It offers a full suite of deposit products, from various checking accounts to certificates of deposit.

This High Yield Savings account earns its industry-leading APY on all balances, although you need $250 to open the account. Interest is compounded daily. There is no monthly fee and you can receive a free ATM card upon request.

As a digital bank, Axos Bank is accessible online and on mobile. Its mobile app includes mobile deposit. Axos Bank also offers a step-by-step Switch Kit to help you switch from your current bank to Axos.

SEE DETAILS Secured

on Axos Bank’s secure website

Member FDIC

9. High Rate: HSBC Direct – 1.01% APY, $1 minimum to open, no minimum balance to earn APY

HSBC Direct Savings from HSBC DirectHSBC Direct is the online division of financial giant, HSBC Bank. Based on the amount of assets HSBC Bank has acquired to date, it is the 14th largest bank in the U.S. While HSBC Direct may sound like a new player to the online banking game, this division was actually around prior to the 2008 financial crisis and offered extremely competitive rates. After the financial crisis, the bank renamed the online division to HSBC Advance and slowly started to decrease its online savings account rates, much like other online banks were doing around that time.

Fortunately, HSBC has decided to reenter the online banking space. Since the initial launch in July of 2018, the bank has consistently increased its HSBC Direct Savings Account rate from 1.70% APY to 1.01% APY. You only need $1 to open the account and the APY will be applied to any balance below $2 million. You may fund the account via ACH transfer and the account can be opened online. You will have to deposit new money to the account, which means that you cannot be a member of the HSBC Group in the United States. The account doesn’t have a monthly maintenance fee and all deposits are FDIC insured.

SEE DETAILS Secured

on HSBC Direct’s secure website

Member FDIC

10. High Rate: Live Oak Bank – 1.00% APY, no minimum to open, no minimum balance to earn APY

High Yield Online Savings from Live Oak BankFounded in 2008, Live Oak Bank offers a great spread of financial products, including its high-yield Online Savings account. The Online Savings account earns 1.85% APY on all balances. Plus, interest is compounded daily for faster savings. There’ s no minimum deposit requirement to open, either, nor a monthly fee to worry about.
In addition to online access, Live Oak Bank offers a mobile app.

SEE DETAILS Secured

on Live Oak Bank’s secure website

Member FDIC

11. High Rate: Citizens Access – 1.00% APY, $5,000 minimum balance amount

Online Savings Account from Citizens AccessCitizens Access is the online division of Citizens Bank. This division was recently created to provide the best savings rates to consumers. While the online division is brand new, the bank its backed by isn’t. Citizens Bank has been around for a while and has grown to have over $122 billion in assets. While you need to deposit and maintain a minimum balance of $5,000 to earn the 1.00% APY, you’ll be funding an account that comes with no fees. If your balance happens to fall below $5,000, the APY will drop to 0.25%. One downside to this online-only bank is that they don’t currently have a mobile banking app. This means that you’ll have to do all of your banking through their website. Luckily, their website is mobile-friendly.

SEE DETAILS Secured

on Citizens Access’s secure website

Member FDIC

12. High Rate: BrioDirect – 0.95% APY, $25 minimum balance amount

High-Yield Savings from BrioDirectBrioDirect is powered by Sterling National Bank, which is a large bank in New York with over $29 billion in assets. This online brand recently launched with a high 0.95% APY. You only need $25 to open the account and you’ll need to maintain at least this amount on a daily basis to earn the APY. This account doesn’t have a monthly service fee and can be funded via ACH, wire transfer, or check.

There are limitations to the amount of money you can transfer in and out via ACH. BrioDirect limits incoming ACH transfers to $500,000. The bank limits outgoing ACH transfers to $25,000 per transaction and a total of $125,000 per month. You are able to link as many external bank accounts as you’d like to this account. You can also initiate ACH deposits and withdrawals from other banks.

You can manage this account online or from Sterling National Bank’s mobile app.

SEE DETAILS Secured

on BrioDirect’s secure website

FDIC Insured

13. Unique Bank + Highest Overall Rate: Fitness Bank – 1.20% APY, $100 minimum to open

Fitness Savings (12,500+ Steps) from FitnessBankFitness Bank is unique and new online bank. It’s a division of Affinity Bank, which has been around since 2002 and has acquired over $318 million in assets. Affinity Bank decided to launch a concept like no other to reward actively fit individuals with the highest APY currently available. While most institutions choose to offer tiered rates based on balance amounts, Fitness Bank offers tiered rates based on the average number of steps you take on a daily basis. To earn the high 1.20% APY, you’ll need to take an average of 12,500 steps or more per day. If you only take an average of 10,000 to 12,499 steps per day, you’ll earn an APY of 1.19% (which is still a great APY). You’ll earn 1.09% APY if you take an average of 7,500 to 9,999 steps per day. Taking an average of 5,000 to 7,499 steps per day will qualify you for an APY of 1.00%. Finally, if you take anywhere between 0 to 4,999 steps on average per day, you’ll only earn 0.75%.

Fitness Bank will track your steps by requiring you to download its Step Tracker app. The bank will then calculate your average steps from the previous month to determine which tier you qualify for. Once the bank determines which rate your activity qualifies you for, you will continue earning that rate for an entire month until the bank recalculates your activity. The activity requirement will be waived for the first month so that you can get your app all set up and start logging in some steps. For this first month, you’ll automatically earn the 1.20% APY.

In terms of actual money, you will need at least $100 to open the account and you’ll need to maintain this balance to waive the $10 monthly maintenance fee. The bank does impose a limit on the amount of money you’re able to transfer in and out of the account via ACH. You cannot transfer more than $15,000 per day in or out of the account. You also cannot exceed more than six certain withdrawals or you’ll incur an excessive withdrawal fee of $10 for each additional withdrawal. In addition to the Step Tracker app, Fitness Bank has a mobile banking app to manage your account.

SEE DETAILS Secured

on FitnessBank’s secure website

Member FDIC

14. High Rate: First Foundation Bank – 1.20% APY, $1,000 to open

Online Savings Account - New Money Only from First Foundation BankFirst Foundation Bank officially launched in 2008, but its leadership has been in the financial services industry since 1990. This bank was established by the same group that leads the Keller Group, a wealth management firm. The bank has grown to acquire over $6 billion in assets. In October, this bank launched an Online Savings Account with a high APY of 1.20%. You’ll need to have a balance of at least $1,000 in order to open that account and you’ll need to maintain that amount in order to earn the high APY. If your balance falls below $1,000, the APY will drop to 1.20%. This account doesn’t have a monthly service fee.

While Regulation D applies to this account, First Foundation Bank will provide an ATM card if you request one from the bank. The bank will reimburse ATM fees from other banks and ATM operators up to $20. There is a limit to the amount of money that you can withdraw. If you’re withdrawing from an ATM, the bank sets a daily limit of $500. The daily point-of-sale limit is $1,500. If you’re transferring money online or via ACH, the daily limit is $20,000 and the monthly limit is $100,000. If you need to transfer more than the preset limits, you’re able to call the bank and request that they increase the limit. The bank allows you to maintain the account online and through their mobile banking app.

SEE DETAILS Secured

on First Foundation Bank’s secure website

Member FDIC

15. High Rate: SFGI Direct – 1.16% APY, $500 to open

SFGI Direct Savings Account from SFGI DirectSFGI Direct is Summit Community Bank’s online division. They currently have more than $2 billion of assets and is privately owned by Summit Financial Group, Inc. SFGI is FDIC insured through Summit Community Bank, so deposits are protected up to the legal limit. They are currently offering a good rate of 1.16% on balances of $1 or greater. You’ll have to deposit a minimum of $500 in order to open the account, but you can’t make an initial deposit greater than $25,000. After you make your initial deposit, you’re able to add as much money as you’d like to the account. While they do offer a good rate on an online savings account, their online experience is lacking. Their website feels dated and they don’t appear to have a mobile banking app.

16. High Rate: Popular Direct – 1.05% APY, $5,000 minimum to open

Popular Direct Ultimate Savings Account from Popular DirectPopular Direct, the online bank of Banco Popular North America, is currently offering an outstanding APY of 1.05% on their Popular Direct Ultimate Savings Account. You’ll need $5,000 to open this account and you’ll have to maintain a daily end of day balance of $500 to avoid the $4 monthly service fee. This account does not come with an ATM card. In order to access your money, you would need to transfer funds to and from an existing checking account via an ACH transfer, which can take a few days. Your deposits are FDIC insured. Popular Direct has a mobile banking app and provides account holders with access to online banking.

SEE DETAILS Secured

on Popular Direct’s secure website

Member FDIC

17. High Rate: Comenity Direct – 1.00% APY, $100 minimum to open

High-Yield Savings Account from Comenity DirectComenity Direct is the online division of Comenity Capital Bank. Comenity Capital Bank has been around since 1989 and has acquired over $9 billion in assets. Comenity Capital Bank launched this online division in the middle of April 2019 and came into the savings space with a high-yield savings account earning 1.00% APY. While you need $100 to open the account, you can earn the high rate with a balance as small as $1 and as big as $10 million.

Comenity Direct’s High-Yield Savings Account doesn’t place limits on ACH transfers. This account doesn’t have any monthly fees and the bank doesn’t charge a fee if you attempt to withdraw from this account more than six times. If you do try to withdraw from the account a seventh time within the same statement cycle, Comenity Bank reserves the right to either deny or reject the withdrawal and may even close the account.

While this is mainly a fee-free savings account, there are a few fees that may be charged if you request paper statements, a paper check withdrawal, and an outgoing wire transfer. Comenity Direct does have a mobile banking app for your convenience. This is one of the best high-yield savings accounts currently being offered, but keep in mind that this online division is brand new. When it comes to accounts with variable rates, we prefer to stick with more established banks with consistently competitive rates.

SEE DETAILS Secured

on Comenity Direct’s secure website

Member FDIC

18. High Rate: Rising Bank – 1.00% APY, $1,000 minimum to open

High Yield Savings Account from Rising BankRising Bank is a divison of Midwest BankCentre and was recently launched in February 2019. Although this internet bank is pretty much brand new, its parent bank has been around since 1906 and has acquired over $1 billion in assets. Rising Bank launched with a strong APY of 1.00%. You’ll need to deposit a minimum of $1,000 in order to open the account and you’ll need to maintain or grow this balance on daily basis in order to continue earning the high rate. This account does have a maximum balance of $500,000. A few other items to be aware of is that interest will be credited to this account every month and if you decide to close the account before the interest is credit to the account, you will not receive the accrued interest. Rising Bank has a mobile app where you can manage your account conveniently.

SEE DETAILS Secured

on Rising Bank’s secure website

Member FDIC

19. High Rate: UFB Direct – 1.00% APY, $10,000 minimum balance to earn APY

UFB High Yield Savings from UFB DirectUFB Direct is a division of Axos Bank, a bank with over $9 billion in assets. This brand has been known to offer high rates not only on its savings accounts, but on its money market accounts, as well. Currently, you can earn a 1.00% APY on its High Yield Savings Account. You will need to keep a balance of $10,000 in order to earn the high rate. The account comes with a free ATM card, but you may want to contact the bank to find out which ATMs you can use without incurring a fee. The bank’s website doesn’t specify. Its disclosure does state that you will only be able to withdraw $510 on a daily basis. This account doesn’t come with any monthly fees. UFB Direct does have a mobile app that allows you to deposit checks.

SEE DETAILS Secured

on UFB Direct’s secure website

Member FDIC

20. For Small Balance Savers: Digital Federal Credit Union – 6.17% APY up to $1k

Primary Savings from Digital Federal Credit Union (DCU)Digital Federal Credit Union (DCU) currently offers a nice account for people who are just starting to save. You can earn an APY of 6.17% with their Primary Savings Account. You will only earn that rate on deposits up to $1,000. Once you have more than $1k, you should consider other accounts on this list. It is a credit union – and your deposits are insured by the NCUA up to the legal limit. Anyone can join the credit union by donating to one of their participating organizations such as Reach Out for Schools, which has a membership fee of $10. You’ll be able to join one their participating organizations when you go to open your account with DCU. DCU is also part of a nationwide CO-OP network that allows their members to have access to shared branches and surcharge-free ATMs throughout the U.S.

MagnifyMoney’s Best Savings Accounts for July 2020

To recap, here are our top picks of the Best Savings Accounts for July 2020.

The Best Savings Accounts in July 2020 Overall

Institution

APY

Bank Review

Marcus by Goldman Sachs High Yield Online Savings

1.05% APY

Marcus by Goldman Sachs Review

Synchrony Bank High-Yield Savings Account

1.05% APY

Synchrony Bank Review

American Express National Bank Personal Savings


1.00% APY

American Express Review

Capital One 360 Performance Savings

1.00% APY

Capital One 360 Review

Ally Bank Online Savings Account

1.00% APY

Ally Bank Review

Barclays Bank Online Savings Account

1.00% APY

Barclays Bank Review

To find the best savings accounts, we look for the banks that consistently offer competitive savings rates. This list is updated weekly to stay on top of the best savings account choices for you.

The Best Online Savings Accounts in July 2020

Institution

APY

Bank Review

Vio Bank High Yield Online Savings Account

1.11% APY




Vio Bank Review

Axos Bank High Yield Savings Account

1.10% APY

Axos Bank Review

HSBC Direct Savings

1.01% APY

HSBC Direct Review

Live Oak Bank Savings Account

1.00% APY

Live Oak Bank Review

Citizens Access Online Savings Account

1.00% APY

Citizens Access Review

BrioDirect High-Yield Savings Account

0.95% APY

BrioDirect Review

Nowadays, the best savings accounts are often found online. New online savings accounts from online banks or even established banks looking to get in on the high-yield action blow traditional savings account rates out of the water. This list is updated weekly to reflect the latest and greatest online savings accounts with consistency over the past two years.

The Best High-Yield Savings Accounts and Rates in July 2020

Institution

APY

Bank Review

Fitness Bank Savings

1.20% APY

Fitness Bank Review

First Foundation Bank Online Savings Account

1.20% APY

First Foundation Bank Review

SFGI Direct Savings Account

1.16% APY

SFGI Direct Review

Popular Direct Ultimate Savings Account

1.05% APY

Popular Direct Review

Comenity Direct High Yield Savings Account

1.00% APY

Comenity Direct Review

Rising Bank High Yield Savings

1.00% APY

Rising Bank Review

UFB Direct High Yield Savings Account

1.00% APY

UFB Direct Review

In today’s fluctuating-rate climate, the best high-yield savings accounts can change from day to day. We stay on top of them for you and list the highest earning savings accounts from this month below.

Why trust us?

At MagnifyMoney, it is our mission to inform our readers about the best financial opportunities out there. Our insights have been cited by top financial publications including Marketwatch, CNBC and the Wall Street Journal.

Our dedicated team of financial experts spends dozens of hours grading online savings accounts according to their interest rates, fee schedules, extra features, minimum balance requirements and accessibility, adjusting our rankings as banks and their offerings change on a weekly basis.

We distilled our picks from a list that included hundreds of banks, credit unions and online institutions nationwide.

Our methodology for picking the best high-yield savings accounts

To find the best high-yield online savings accounts, MagnifyMoney looks at over 6,000 financial institutions each week, from small community banks and credit unions to traditional brick-and-mortar banks to new online banks.

  1. Savings account rates: We heavily weighted the APYs offered by each bank in terms of both magnitude and consistency. Higher savings rates were prioritized over lower rates. Due to the variable rates on savings accounts, we also gave additional consideration to banks that were known to maintain competitive rates over longer periods of time.
  2. Minimum deposit and balance requirements: To ensure accessibility to all customers, we focused on banks that welcome deposits of all sizes, where the ideal banks in this category have minimum balance and deposit requirements of $0.
  3. Bank account fees: Unnecessary fees can eat into your long-term savings in a major way. Banks that offered low or no fees were given priority in this category over banks that are known to charge account maintenance fees, service charges and other surcharges.
  4. Customer service: We considered overall customer satisfaction and bank reputation when weighing each bank performance in this category. While each customer’s experience varies, we looked at relative feedback each bank received at the national level based on data sourced from consumer advocates like the Consumer Financial Protection Bureau (CFPB) and the Better Business Bureau. Banks that failed to meet minimum standards of performance were excluded.

What should I know about high-yield savings accounts?

It’s easy to take your savings account for granted, setting up automatic deposits and forgetting about it. But there’s a lot more to high-yield savings accounts that you should know.

For one, you can find consistently more competitive rates at online banks than with your typical big bank. Online banks are also more fee-friendly — although there are still some legal limitations you should be aware of to avoid extra fees.

What is a high-yield savings account?

A high-yield savings account, also known as a high-interest savings account, is a savings account that earns interest at a higher rate than a traditional savings account. The average savings account interest rate tends to hover around 0.20% APY, but big brick-and-mortar banks often offer interest rates more like 0.01% APY.

High-yield savings accounts raise the bar and offer upwards of 1% to 2% APY — sometimes even 3% APY in good rate conditions. High-interest savings accounts are also more likely to come with added benefits like little to no fees, especially when offered by an online bank.

How much interest will I earn with a high-yield savings account?

When you open a high-yield savings account, you’re almost guaranteed to earn more in interest than with a traditional savings account.

For example, let’s say you have $5,000 to deposit into a savings account. If you choose a high-interest savings account with a 2.30% APY, for example, you’ll earn $116 and some change in a year, provided you don’t make any additional contributions to the account in that time (which would boost your savings even more).

If you deposit your $5,000 into an average savings account at 0.20% APY for a year, you’ll earn just $10 in interest. It’s a pretty big difference in earnings, and all it takes is a simple account switch.

Even in a low-rate environment, where a high-yield savings account might be earning 1.30%, for example, you’ll still make about $65 in interest, which is still well over the $10 average earnings from a traditional savings account.

Does the APY for high-yield savings accounts change?

Savings accounts are variable-rate accounts, so their rates are subject to change — and they will over the course of an account’s lifetime. This is in contrast to fixed-rate savings vehicles, like CDs, which have set rates for predetermined periods of time.

There is no universal answer for how often interest rates change on high-yield savings accounts, since each institution has its own policies and decisions. However, you can often expect an institution to change its savings account rates about once a month at least. This change typically happens at the beginning of the month.

High-interest savings accounts are also more likely to see changes in their APYs than traditional low-rate savings accounts, because high-interest accounts have more room to change. Traditional savings account rates can only go so low, especially since many of them are already bottomed out at 0.01% APY.

How to choose the best high-yield savings account

  • Start by finding the highest APY
  • Check whether the institution is consistent with its high rates
  • Look for a no-fee account
  • Confirm any account balance minimums

When you’re looking for the best high-yield savings account, it’s tempting to go straight for the highest APY you can find. That account will certainly offer the highest yield at the moment, but there’s also more to it than that. Unless you’re okay with the possibility of switching accounts periodically to chase the highest rates, it may help to find an account offered by an institution that consistently offers some of the most competitive savings account rates. We’ve started our roundup above with those accounts, offered by consistent industry-leaders over the past two years.

But high yields may mean nothing if you lose your earnings to fees, so the best high-interest savings accounts out there are also the ones with little to no fees. Look for accounts with no monthly service fees, no overdraft fees and/or no excessive transaction fees. This will help you keep your savings intact.

You’ll also want to choose a high-yield savings account that works within your existing finances. Some accounts may impose minimum deposit or balance requirements to open and keep the account. We think the best high-interest accounts are the ones that require low or $0 minimums, which makes the account much more accessible to savers. But, if you have a high balance and find a savings account that offers a higher rate for high balances, then you can go for that account if it better fits your needs.

How do I open a high-yield savings account?

In most cases, opening a high yield savings account is as easy as clicking a button on the institution’s website and completing a short application form. You will likely be approved for the account right away.

A savings account application will likely require your name, home address, email address and Social Security Number. If the account requires a minimum deposit at opening, you’ll also likely have to link an external account at this time. Otherwise, you may make your initial deposit after opening, often within a 30- or 60-day window.

If you have a rocky banking history, like previous negative balances or circumstances where the institution closed your account, your application for a high-interest account may be denied. You can check out your recorded banking history with ChexSystems, a reporting system that many banks use. If there are any errors or points of contention, you may be able to dispute an item in your ChexSystems report.

What should I use a high-yield savings account for?

You can use a high-yield savings account for a variety of reasons and savings goals. You can use it as your emergency fund, where you stash your cash for a rainy day, for example. Perhaps you want to use a high-interest savings account to boost your savings toward your next vacation or your kid’s college education.

Luckily, many institutions allow you to have several savings accounts at a time, meaning you can save toward separate goals simultaneously without ever getting your wires crossed.

Should I get an online savings account?

An online savings account is your best bet for obtaining the highest interest rate available. Online banks lack the costs associated with maintaining brick-and-mortar branches, and they generally pass the savings onto you in the form of better interest payouts. And like we’ve said, if your money is going to sit in an account, you might as well make it worth your while by growing it at a competitive rate.

Online savings accounts generally feature superior accessibility. Online banks are laser-focused on offering the best possible and most user-friendly app experiences. There’s often 24/7 customer service, and they tend to provide very good ATM access. When shopping for the best savings account to suit your needs, make sure you include a good mix of online banks offering high yields, brick-and-mortar banks and credit unions in your search.

What impacts savings rates?

Institutions typically alter their rates in response to changes in market interest rates, which are in turn driven by the federal funds rate set by the Federal Reserve. The federal funds rate influences the rates banks lend money to each other. When the Fed increases the federal funds rate, financial institutions respond by increasing the interest rates they offer on deposit accounts. When the federal funds rate falls, interest rates decrease.

If you’re not keen on tracking the federal funds rate, changes to the APY on your savings account may come as a surprise. Luckily, chances are that if you keep your deposits with an online bank, you’ll still get the most competitive rates regardless of a Fed pause or rate decrease. Online savings accounts outperform most brick-and-mortar rates any day.

What are the best banks for high-yield online savings accounts?

Here’s a summary of our top picks:

  • 1.05% APY – Marcus by Goldman Sachs
  • 1.00% APY – American Express National Bank
  • 1.00% APY – Capital One
  • 1.00% APY – Barclays Bank
  • 1.00% APY – Ally Bank
  • 1.05% APY – Synchrony Bank
  • 1.11% APY – Vio Bank
  • 1.00% APY – Live Oak Bank
  • 0.95% APY – BrioDirect
  • 0.95% APY – CIT Bank
  • 1.00% APY – Citizens Access
  • 1.15% APY – CIBC Bank USA
  • 1.20% APY – Fitness Bank
  • 1.20% APY – First Foundation Bank
  • 1.16% APY – SFGI Direct
  • 1.01% APY – Prime Alliance Bank
  • 1.01% APY – HSBC Direct
  • 1.00% APY – Comenity Direct
  • 1.05% APY – Popular Direct
  • 6.17% APY – Digital Federal Credit Union

Savings Account FAQs

There is nothing inherently unsafe about a high-yield savings account. As long as you make sure you’re depositing your money into an FDIC-insured bank or NCUA-insured credit union, your money will be insured up to legal amounts in case your institution fails.

You may also want to double check an institution’s security measures before signing up for an account. Check whether their website and information is protected by encryption and firewalls. Reputable institutions will also include anti-virus and anti-fraud measures. Other protections include biometric logins (fingerprints or face match), two-factor verification and security questions.

There is often not much difference between high-interest savings accounts and money market accounts. A money market account is a type of savings account that also tends to have higher rates than traditional savings accounts.

Some money market accounts set themselves apart by offering a debit or ATM card and/or check-writing capabilities. These accounts offer further accessibility to your money. However, money market accounts still fall under the six-limit “convenient” transaction requirement, like regular savings accounts.

High-yield savings accounts are taxed like regular savings accounts. However, your earnings from a high-interest savings account are more likely to be taxed, as you are more likely to be earning more in that account than a traditional low-rate account.

Savings account earnings are taxed if you make $10 or more. Regardless of your earnings, your institution should send you and the IRS a copy of Form 1099-INT, which details the interest you’ve earned in a year. Even if you don’t receive that form, the IRS will, and they will expect you to report your interest income on your tax return.

If you earn $1,500 or more in interest income in a year, you will also need to detail those sources of income on Schedule B of Form 1040.

Thanks to the Federal Reserve’s Regulation D, you can withdraw up to six times per statement cycle from a high-yield savings account, like any other savings account. This includes pre-authorized and automatic withdrawals and transfers, and transfers made by debit card, check or other similar ways.You can get around this limit by performing “less convenient” withdrawals, like those made in person at the bank or ATM. Exceptions to the rule also include withdrawals and transfers requested by mail and those initiated over the phone if you receive the withdrawal as a mailed check.

Online banks don’t incur the costs of maintaining brick-and-mortar branches. These costs include rent, building maintenance, staff salaries and the cost of keeping physical cash safe. Without these expenses weighing them down, online banks reap big savings — savings they then pass on to their customers in the form of high interest rates.

June savings index: Slight drop following May surge

Just under 40% of consumers added money to their savings account in June, a four percentage-point decrease from May but still higher than March and April levels. More concerning, however, is the fact that the number of Americans who said they’re saving for emergencies dropped from 35% in May to just 21% in June.

Every month, MagnifyMoney surveys more than 1,000 consumers to find out whether or not they added money to their savings account and what they’re currently saving for. The results comprise our monthly savings index, which first began in October 2019.

38% of consumers increased savings in June

  • The percentage of consumers who increased their savings dropped to 38% in June from 42% in May.  Last month’s rise was due in part to economic impact payments hitting many Americans’ bank accounts, and it’s still promising that nearly 4 in 10 consumers continued adding to savings this month, too.

Number of Americans saving for emergencies declined

  • While the reduction in the number of consumers who added to savings was minimal month-over-month, the decline in those saving for emergencies was much more pronounced. In June, 21% of Americans said they were saving money for emergencies. That number was 35% in May and 33% in April. Although the decrease could mean most consumers now have sufficient funds for emergencies, that’s unlikely. For one, a May MagnifyMoney survey found more than a quarter of Americans do not even have $1,000 saved.Still, emergencies are among the top things consumers are saving for, in addition to general savings, vacations, retirement and new cars.

Generational differences

  • Some age groups are saving more than others, namely millennials and Gen Xers. Among all generations, they had the highest percentage of respondents indicate they added money to savings in June, at 40% and 41%, respectively. Gen Z was a bit lower at 34%, while baby boomers (32%) and members of the silent generation (12%) were least likely to save. On the other hand, consumers aged 55 and older were more likely than younger age groups to say they didn’t add or remove money from savings.

Different age groups also vary in the things they’re saving up for. There are the top things Americans are saving up for broken out by generation:

  • Gen Z: college (22%), general savings (22%), new car (18%)
  • Millennials: general savings (27%), emergencies (22%), vacation (20%)
  • Gen Xgeneral savings (24%), emergencies (22%), retirement (18%)
  • Baby boomers: general savings (27%), retirement (25%), emergencies (24%)
  • Gen Z: general savings (41%), retirement (18%), emergencies (18%)

Major savings gender gap remains

  • Each month, a major savings gender gap appears, and June is no different. Just 31% of women added money to savings this month, compared to 45% of men.Even more troubling, more than a quarter of women don’t have any money saved at all, while just 16% of men said the same.Women traditionally are paid less than men, and recent data from the Bureau of Labor Statistics shows women are experiencing more pandemic-related job losses than men.

Workers whose jobs were impacted by the pandemic turn to savings fund to cover expenses

  • Consumers experiencing income loss due to the coronavirus pandemic are tapping into their savings accounts at a much higher rate than those whose job was not impacted. Nearly a third (30%) of Americans who were either laid off/furloughed or saw a reduction in salary/hours took money out of savings in June, versus just 11% of consumers who did not have any changes in wages.Interestingly, there was not much of a difference in terms of who added money to savings.As the additional weekly unemployment stipends are slated to run out next month, we may see even more consumers deplete their savings to make ends meet.

Why some aren’t saving

We also asked those who weren’t able to save money in June about the circumstances that kept them from doing so. Here’s what they said (some chose multiple reasons):

  • Have too many expenses this month (36%)
  • Don’t make enough money to save (35%)
  • Already have enough money in savings (17%)
  • Other (12%)
  • Job loss due to the coronavirus (11%)

It’s worth noting that every dollar added to savings makes a difference. Even adding just $5 per week adds up over time, especially if you’re able to open a high-yield savings account offering a competitive interest rate.

Survey Methodology

MagnifyMoney commissioned Qualtrics to conduct an online survey of 1,020 Americans, with the sample base proportioned to represent the overall population. The survey was fielded June 12-15, 2020.

We defined generations as the following ages in 2020:

  • Gen Z are ages 18 to 23
  • Millennials are ages 24 to 39
  • Gen X are ages 40 to 54
  • Baby boomers are ages 55 to 74
  • Silent Generation are ages 75 and older

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Best of, Earning Interest

The Best IRA CD Rates – July 2020

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It may not have been previewed, commissioned or otherwise endorsed by any of our network partners.

Written By

Reviewed By

Perhaps you’ve decided to build a CD ladder within your IRA, or maybe you’re looking for a safe way to store your retirement cash for a specific period of time. Whatever the reason, you’re interested in getting an IRA CD and, understandably, want to know what products will give you the best rate of return.You can get an IRA CD with terms ranging from three months to more than six years, with interest rates generally increasing with the term length. There are lots of options, so we’ve rounded up the top IRA CD rates that are available right now for a variety of terms. You’ll select your IRA CD terms based on your CD-ladder master plan or whenever you’ll need access to your money.

Every month, we choose the best IRA CD rates using data from another LendingTree company DepositAccounts.com, a database of offerings at more than 17,100 banks and credit unions. We sorted the products by APY, then eliminated institutions with a health rating below a B. We then eliminated products that are not available nationwide. From there, we chose the IRA CD with the highest APY among products with a minimum deposit no greater than $5,000. Here are the best options.

The best IRA rates in July 2020

TermInstitutionAPYMinimum Deposit Amount
3 monthsSignature Federal Credit Union0.45%$500
6 monthsCommunitywide FCU1.10%$1,000
12 monthsLafayette Federal Credit Union0.80%$500
18 monthsGeorgia's Own Credit Union1.69%$500
2 yearsLafayette Federal Credit Union0.90%$500
3 yearsLafayette Federal Credit Union1.01%$500
4 yearsLafayette Federal Credit Union1.16%$500
5 yearsLafayette Federal Credit Union1.26%$500
6 yearsEvansville Teachers FCU1.35%$1,000

Best 3-month IRA CD – BethPage Federal Credit Union (Traditional, Roth)

3 Month IRA from Bethpage Federal Credit Union The BethPage Federal Credit Union features the most competitive 3-month IRA CD that’s currently available, with an APY of 0.50% and a minimum deposit of just $50.

Best 6-month IRA CD – Communitywide Federal Credit Union (Traditional, Roth)

6 Month IRA from Communitywide Federal Credit Union
CommunityWide Federal Credit Union is offering the highest rate available on 6-month IRA CDs at 1.10% APY for deposits of $1,000 and over. It has other IRA CD products, too, with term lengths ranging from 6 to 60 months.

SEE DETAILS Secured

on Communitywide Federal Credit Union’s secure website

NCUA Insured

Best 1-year IRA CD — State Department Federal Credit Union (Traditional, Roth)

12 Month IRA Certificate from State Department Federal Credit Union This one-year term share certificate earns an APY of 1.31% and requires a minimum deposit of $500. This is a significantly higher rate than the credit union’s traditional one-year share certificate, which earns an APY of 1.21%.

SEE DETAILS Secured

on State Department Federal Credit Union’s secure website

NCUA Insured

Best 18-month IRA CD – Georgia’s Own Credit Union (Traditional, Roth)

18 Month IRA from Georgia's Own Credit UnionGeorgia’s Own Credit Union is currently featuring a very attractive APY of 1.69% on its 18-month IRA CD. There is a minimum deposit of $500 required to earn this APY. Interest on this product is compounded monthly.

SEE DETAILS Secured

on Georgia's Own Credit Union’s secure website

NCUA Insured

Best 2-year IRA CD, 3-year IRA CD, 4-year IRA CD – Pen Air Federal Credit Union (Traditional, Roth, SEP, CESA)

24 Month IRA from Pen Air Federal Credit Union Pen Air Federal Credit Union is currently offering a competitive rate on its 2-year IRA CD with a 1.40% APY as well as its 3-year IRA CD, with a rate of 1.45% and its 4-year IRA CD with a rate of 1.55% APY. There is a minimum deposit of $500 required for this account, according to DepositAccounts.

SEE DETAILS Secured

on Pen Air Federal Credit Union’s secure website

NCUA Insured

Best 5-year IRA CD – Riverland FCU (Traditional, Roth, CESA and SEP)

60 Month IRA Certificate from RiverLand Federal Credit Union Riverland Federal Credit Union is currently offering an extremely competitive rate of 1.95% on its 5-year IRA CD. There is a low minimum deposit of just $1,000 required for this product.

SEE DETAILS Secured

on RiverLand Federal Credit Union’s secure website

NCUA Insured

Best 6-year IRA CD — Evansville Teachers FCU (Traditional, Roth, CESSA)

6 Year IRA from Evansville Teachers Federal Credit UnionTo join this credit union, you may make a $5 donation to the Mater Dei Friends & Alumni Association. You may want to strongly consider doing so, as the 6-year IRA CD rate offered by Evansville FCU is the best on the market in terms of APY. Plus, it only requires a minimum balance of $1,000.

SEE DETAILS Secured

on Evansville Teachers Federal Credit Union’s secure website

NCUA Insured

3 questions to consider before opening an IRA CD

Opening an IRA CD generally requires filling out a form or talking to a banker. You’ll have to have a way to fund your IRA CD, whether that’s rolling over an existing retirement account into an IRA CD or depositing cash into the product. The same limits that apply to IRA contributions apply to IRA CDs: $5,500 per year ($6,500 if you’re over age 50) of your own money across all your IRA accounts each year, and you can do a rollover once per year.

Unless you’ve invested in a bump-up IRA CD, you won’t be able to take advantage of a higher rate until your CD matures. Withdrawing funds from an IRA CD before they mature will result in a stiff penalty. Bump-up IRA CDs give you a chance to increase your interest rate to a higher level if it’s available, but you’re generally only allowed to do this once or twice during the life of the CD.

You can either use the direct-transfer method or the indirect-transfer method. The direct transfer method requires setting up your new IRA account filling out a form authorizing the bank or credit union to transfer money from the old account into the new account. The indirect transfer method involves you asking for a check from your old IRA account. You have up to 60 days to deposit that check into your IRA CD to avoid incurring a penalty.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.