Compare Savings Accounts: Weigh These 8 Crucial Factors

Savings accounts are one of the most essential parts of personal finance. Money you keep in your savings account is safe and relatively accessible and can grow over time through interest. This makes them great for building an emergency fund and saving for various life goals, like a house down payment, wedding, or big family vacation.

Choosing the best savings account for your needs is an important decision that warrants careful consideration. Below, I’ll break down all the core features to weigh as you decide.

Table of Contents

1. 1. Annual percentage yield (APY)
2. 2. Ease of access
3. 3. New customer bonuses
4. 4. Fees and balance requirements
5. 5. Liquidity
6. 6. Easy organization
7. 7. Joint usage
8. 8. Automatic savings features
9. Other features to consider

1. Annual percentage yield (APY)

The most essential component of a savings account is its annual percentage yield (APY). This refers to how much interest the account earns in a year. The higher the percentage, the more money you’ll make, just by leaving your money in the bank.

How much interest can you earn? That depends on the savings account you choose:

• Traditional savings accounts from big banks like Wells Fargo and Chase pay a paltry 0.01% APY on savings.
• According to the Federal Reserve, the national average rate for savings deposit accounts is 0.40%.
• Some of the best high-yield savings accounts pay around between 3% and 4%, sometimes more.
  

This can make a huge difference in how fast your savings grow. For instance, let’s assume you deposit $5,000 in a savings account and let it sit for five years. The table below shows how much you’d have at the end of those five years with various APYs.

At 0.01%, you’d earn $2.50 in five years. At 4%, you’d earn more than $1,100. Now imagine how much more your money would grow if you started making regular contributions to the account over those five years; even small contributions, like $10 a week, can help you make major strides over time.

Best banks and credit unions for high-yield savings accounts

These are some of our favorite high-yield savings accounts:

I often warn clients about chasing interest rates while overlooking other important features. Changing accounts frequently to earn a slightly higher interest rate can be disruptive and time-consuming.

Instead, I recommend focusing on features like no fees or minimum balance, ease of access to funds when needed, and the ability to set up sub accounts for savings goals.

2. Ease of access

A savings account is a much safer way to save money than shoving it under your mattress, but I have to admit: Mattress money is much easier to get in a pinch.

It’s not terribly hard to access your savings account when you need cash, but some banks make it easier than others. Here’s what to consider when choosing a savings account:

• Physical branches: Is it important to you to be able to physically enter a bank and withdraw or deposit cash? Online-only banks typically offer the highest APYs and lowest fees, but none of that matters if you want a brick-and-mortar banking experience.
• ATM network: Banks and credit unions offer fee-free ATMs where you can deposit and withdraw money. Some banks may not operate their own ATMs but instead belong to a network of ATMs, such as the Allpoint network, which allows you to access any of its 55,000 participating ATMs across the country, fee-free. If ATM usage is important to you, prioritize a bank or credit union with a wide range of ATMs.

The table below shows a few large banks, including their number of in-person branches and ATMs in the U.S.

As you can see, big banks have more physical locations but often operate their own smaller network of ATMs, while online banks may have very few (or no) branches but belong to larger ATM networks.

Digital access to savings accounts

In today’s digital world, ease of access doesn’t have to mean a physical bank you can swing by on your way to work. It can also mean banking with an easy-to-use mobile app and connecting your online savings account to an external account to move money back and forth.

If you can stomach the thought of banking without a nearby branch, I recommend choosing an online bank with a high-yield savings account. You can even open a checking account at a local bank with a physical branch and then connect that account with your high-yield online savings account so you can easily transfer funds.

This gives you the best of both worlds.

3. New customer bonuses

Many banks run special promotions to win your business. While new account bonuses are more common for checking accounts, it’s possible to find banks offering bonuses for opening a new savings account, either a flat cash bonus or a temporarily higher APY for the first few months.

To earn the bonus, banks usually require you to do one or more of the following:

• Maintain a specified minimum balance
• Make a certain number of deposits
• Keep the account open for a certain amount of time

For instance, Alliant Credit Union offers a $100 bonus for its Ultimate Opportunity Savings account if you make monthly deposits of $100 a month for 12 consecutive months.

I don’t recommend choosing a bank specifically for its new customer bonus. You want to prioritize an account that will benefit you in the long run, not offer a quick payout and then no great benefits afterward. That said, if you’re comparing two similar savings accounts, and one offers a bonus and the other doesn’t, go for it!

4. Fees and balance requirements

Some banks may charge fees for their savings accounts. This is more common with traditional savings accounts at large brick-and-mortar banks. Online banks have lower overhead and thus can operate without charging monthly fees.

When choosing a bank account, look closely at the fine print for all fees. I recommend choosing a savings account with no fees. (Capital One, I see you.)

If there’s a savings account that you like but it charges a fee, see if there’s a way you can waive the fee. For instance, Wells Fargo charges a $5 monthly fee for its Way2Save Savings account, but you can waive it by:

• Maintaining a minimum daily balance of $300
• Transferring funds from linked Wells Fargo checking accounts
• Being 24 or younger

Some banks and credit unions also set minimum opening deposit requirements and minimum balance requirements for their savings accounts. This means you may need a certain amount of cash to open the account, and you may need to keep a specific amount of cash in the account to keep the bank from closing.

While these are often low (for instance, Bank of America requires $100 to open a savings account), they can make accounts less practical for anyone living paycheck to paycheck.

Savings accounts without monthly fees or minimum balance requirements

Want a savings account without any monthly fees or minimum balance requirements? Here are some of my favorites:

• SoFi
• Ally Bank
• Capital One
• Chime

5. Liquidity

Before 2020, you weren’t allowed to make more than six monthly transfers from savings, whether that was a direct cash withdrawal, a transfer to a linked savings account, or an external transfer to another bank. This restriction (Regulation D) was meant to differentiate savings from checking and encourage consumers to leave money in their savings account without the constant temptation to spend it.

The Federal Reserve eliminated Reg D in April 2020. Now, you can transfer money as often as you’d like.

However, some banks have retained the six-per-month transfer limit, either prohibiting additional transfers outright or charging fees for them. This makes it harder to manage your money, especially if your finances are more complicated and require frequent shuffling between accounts.

If you suspect you’ll ever need to touch your savings, for whatever reason, more than six times a month, prioritize a savings account that allows more liquidity.

Savings accounts that cap monthly transfers

Here are some savings accounts to stay away from if you want the freedom to transfer when you want, without fees:

• TD Bank
• PNC
• Bank of America

6. Easy organization

As your finances get more complicated, you might start saving for multiple goals at the same time. Rather than track this in an Excel sheet or the Notes app on your phone, look for a bank that lets you categorize your savings into sub accounts (or multiple savings accounts).

With Capital One, I’m able to operate multiple savings accounts, all earning the same high APY. This makes it easier for my family to monitor our emergency fund, home renovation fund, savings toward a car, and (my favorite) our vacation fund.

Other banks and credit unions let you do something similar:

• Ally has “savings buckets”
• SoFi offers “savings vaults”
• BMO lets you set “savings goals”

7. Joint usage

If you want to manage your savings with a spouse, partner, child, parent, or other trusted loved one, look for a bank that allows for joint accounts. Many banks offer this feature, which can make sharing finances much easier.

Again, I’ll shout out Capital One: Both my husband and I have full access to all our joint accounts, including savings, checking, and credit cards.

Not every bank allows this. For instance, Chime and Varo, two of the most popular online banking platforms, only allow single personal savings accounts.

8. Automatic savings features

If you’re just starting to establish healthy money habits, look for a savings account with built-in features that put your savings on autopilot. For instance, some online banks offer features that let you:

• Schedule automatic transfers from checking to savings
• Direct a portion of your direct deposit paycheck straight to savings, instead of checking
• Round up debit card purchases and put the spare change into your savings account

Little features like this can go a long way, especially when you’re early on your savings journey. My favorite bank for automatic savings features is Chime.

Other savings accounts features to consider

The factors discussed above are important to keep in mind when comparing savings accounts, but they’re not the only ones. Here are some additional considerations when opening a savings account:

• Security: What security features does the bank offer for its mobile app? Find a savings account with multi-factor authentication, and if opening a checking account or credit card, too, find a bank that allows real-time push notifications every time your card is used.
• Insurance: Most savings accounts come with $250,000 of FDIC insurance (banks) or NCUA insurance (credit unions). This is usually standard, but always double-check this just in case. Some banks may offer even more protection; SoFi, for instance, offers up to $2 million in FDIC insurance.
• Other banking products: It’s totally possible to open a savings account with one bank and manage your checking account through another. However, if you can find a bank that ticks all your boxes for savings, checking, and credit cards, you’ll appreciate the more seamless banking experience of having everything in one place.
• Customer service: Don’t forget to consider customer satisfaction when comparing savings accounts. Whether you’re dealing with a fraudulent charge or an issue with the mobile app, you want a bank that prides itself on fast, pleasant resolutions. J.D. Power’s annual banking satisfaction studies are a good place to start.

Why you can trust me on savings accounts

I’m a personal finance writer and a Certified Financial Education Instructor (CFEI®) with a decade of experience, and I owe it all to a passion for saving.

Before launching my financial career, I was happy to help advise friends and family as they chose the best savings accounts for their needs and worked on their budgets to maximize how much they could save or invest.

Now, as a financial writer, I cover everything from loans and taxes to insurance and retirement, but to this day, there’s nothing I love more than digging into savings accounts and helping everyday Americans make the most of their money.