When to Escape From a Bad Relationship With Your Bank -- And Make 5% APY

Sometimes when people have been in a relationship with their bank for too long, it gets stale and complacent. They stop growing (their money). Have you been banking with the same bank for many years? If so, you might not realize that you can earn higher yields on your savings.

Banks pay the lowest rates on savings accounts that customers let them get away with. Sometimes big banks count on people getting stuck in a rut and being unwilling to switch savings accounts, even if it's the right move for their money. If you're not shopping around for better savings accounts, your bank might be taking advantage of you.

You don't have to stay in a "bad relationship" with your bank anymore, because there are better banks out there that will treat your savings with love, generosity, and respect. It's time to play the field and find new happiness with a 5.00% APY savings account.

Let's look at a few reasons why it might be time to break up with your bank.

Our Picks for the Best High-Yield Savings Accounts of 2024

Capital One 360 Performance Savings APY 4.25% Rate info See Capital One website for most up-to-date rates. Advertised Annual Percentage Yield (APY) is variable and accurate as of April 11, 2024. Rates are subject to change at any time before or after account opening. Min. to earn $0 Open Account for Capital One 360 Performance Savings Member FDIC.	APY 4.25% Rate info See Capital One website for most up-to-date rates. Advertised Annual Percentage Yield (APY) is variable and accurate as of April 11, 2024. Rates are subject to change at any time before or after account opening.	Min. to earn $0
American Express® High Yield Savings APY 4.25% Rate info 4.25% annual percentage yield as of July 2, 2024 Min. to earn $1 Open Account for American Express® High Yield Savings Member FDIC.	APY 4.25% Rate info 4.25% annual percentage yield as of July 2, 2024	Min. to earn $1
Citizens Access® Savings APY 4.50% Min. to earn $0.01 Open Account for Citizens Access® Savings Member FDIC.	APY 4.50%	Min. to earn $0.01

Don't settle for "average" bank savings rates

Even though the Fed raised interest rates in 2022-2023, and seems to be keeping interest rates at over 5% for now, many banks haven't gotten with the times. Is your bank still acting like it's 2009 and paying near-zero interest?

According to the latest FDIC data as of May 20, 2024, the national average savings account pays 0.45% APY. That's already pretty low -- $10,000 in a 0.45% savings account would earn only $45 in a year. But some big banks like Chase, U.S. Bank, Bank of America, and Wells Fargo pay even lower interest on savings -- as low as 0.01% APY. At that rate, you'll only get $1 per year on $10,000 of cash.

Would you stay in a relationship with a partner who hasn't made any effort to improve themselves since 2009? Of course not! So why put up with this lackluster treatment from your bank?

What happens when you move money to the best savings accounts

If you've been keeping your cash in a bad banking relationship because it feels safe or you don't think you deserve anything better, it's time to get rid of that negative self-talk. Put your money back on the market. Better bank accounts are out there.

Right now, the best savings accounts are offering as much as 5.36% APY. This means that $10,000 would grow by $536 in the first year!

Here's what happens when you get out of that stale, unrewarding bank relationship and put your money into a better savings account.

1. Your money grows

Here's how much $10,000 of savings would grow after a few years with some of the best savings account rates, compared to the national average savings account (0.45% APY) and some of the lowest-yield savings accounts (0.01% APY):

The takeaway: Your current bank's near-zero savings account might be costing you thousands of dollars of yield over the next few years. Some high-yield checking accounts even pay better interest than traditional savings accounts.

2. Your money is still safe with FDIC insurance

A good banking relationship should offer safety as well as growth. All of The Ascent's picks for best savings accounts are with banks that have FDIC insurance. Even if a high-yield savings account is offered by a smaller bank or an online bank that you haven't heard of before, as long as it has FDIC insurance, your money is just as safe as it is with a big bank that pays zero interest. FDIC insurance protects your money against bank failure, up to $250,000 per bank, per depositor, per ownership category.

Bottom line

Just like a good relationship or life partnership, bank accounts should make your life better. Banks should make you richer, not poorer. The best savings accounts can help you earn hundreds or thousands of dollars more than the national average. Don't settle for less -- check out the best savings account rates and get the rewarding, fulfilling banking relationship that you deserve.