Finding the Best Online High-Yield Savings Accounts
Online banks, which don’t have the burden of needing to maintain branches, have an edge over traditional banks in terms of the perks and interest rates they can offer. Still, not every online bank may be a good fit for you. At SmartAsset, we took a look at several online banks with high-yield interest rates and determined the best. To see which online high-yield savings account is right for your needs, read on.
|Synchrony Read More||1.05%||$0|| |
|Varo Bank Read More||1.21%||$0|| |
|Ally Bank Read More||1.10%||$0|| |
|Capital One Read More||1.00%||$0|| |
|Alliant Credit Union Read More||1.60%||$5|| |
How We Determine the Best Online High-Yield Savings Accounts
SmartAsset’s team of personal finance experts rounded up an exhaustive list of different online savings accounts. We scored each on their APY, low fees and an easy to use mobile app for on-the-go banking.
Best Online High-Yield Savings Account: Synchrony Bank
With a 1.05% APY, Synchrony has the best overall high-yield savings account. With a high-yield savings account, you don’t need to worry about paying monthly fees or maintaining a minimum balance. This makes Synchrony particularly valuable for new or young savers.
With the exception of one branch in New Jersey, Synchrony is an entirely online financial institution. The bank makes it exceptionally easy to manage your funds, however. In fact, Synchrony boasts a great mobile app and an easy-to-use online banking website.
The main downside to Synchrony is that it does not offer a checking account, which would allow for easy transfers between accounts. If you want to send your savings funds to a checking account, you would have to do so through an electronic funds transfer, which can take a couple of days.
Synchrony helps make up for the above, however, by allowing ATM withdrawals from a robust network of ATMs. You can also fund an account with a mobile check deposit in the app. Just be aware you only have six free transactions per month on the account.
Best Online High-Yield Savings Account Bonus: Varo Savings Account
Varo Bank’s Savings Account is a great option for anyone looking to boost their savings at a higher rate than most other banks. The account’s base APY is extremely high on its own, as it stands at a 1.21% APY as soon as you have $0.01 in your account. A savings bonus at a typical bank usually comes in the form of a specific amount of money. However, at Varo, your rewards bonus is a massively upgraded 2.80% APY. To earn this rate, you need to:
- Make at least five debit card purchases per month
- Receive more than $1,000 in direct deposits per month
- Keep your savings balance below the maximum $10,000
This account is a solid option even if you don’t meet the requirements for the aforementioned upgraded APY. There is no minimum account balance, minimum opening balance or monthly account fees.
Varo is exclusively an online and mobile bank. Customers can access all account features through either the bank’s highly rated mobile app or over the phone with customer service. To open a Varo Savings Account, all you need to do is first open a Varo checking account, which will then unlock your ability to open the savings account and transfer money into it.
Best for Customer Experience: Ally Bank
Ally's savings account offers a competitive rate with no fees or minimums. But Ally's savings account is at its best when it's paired with the bank's checking account. Yes, unlike at Synchrony and DollarSavingsDirect, you can also get a free checking account at Ally, which can make transferring and withdrawing funds much easier. Rather than waiting for money to transfer, you can internally move money between your checking and savings account whenever you please.
Ally checking accounts also come with an interest rate of their own. As we discuss more in our best checking account review, Ally checking offers the highest interest rate for amounts under $50,000 - making it one of the best accounts for young professionals. Furthermore, Ally will reimburse you up to $10 per month for out-of-network ATM fees (in addition to having a network of 55,000 in-network ATMs).
Best Online High-Yield Savings Account at a Brick-and-Mortar Bank: Capital One 360 Performance Savings
The bank that best marries a high-yield online savings with branch access is Capital One. Banking entirely online can be uncomfortable for some, and Capital One provides a happy medium. The 1.00% APY is competitive with the three banks above. Plus, at the end of the day, you want to feel comfortable with where you deposit your money. Capital One has branches in the Northeast, Texas and Louisiana, so if you live in those areas, Capital One can be a great option.
The savings account has no monthly fees and doesn’t require a minimum balance. Capital One also provides 24/7 customer service and has a mobile app with 4.5 stars on the Apple App Store. As with Ally, Capital One offers a suite of banking products - including a checking account - that also accrues interest.
Best Online High-Yield Savings Account at a Credit Union: Alliant Credit Union
The Alliant High-Rate Savings account offers one of the highest rates around at 1.60%. Like the accounts above, Alliant’s savings account is virtually free, as you only need $5 to maintain the account. You do, however, need to maintain a balance of at least $100 to earn interest. There are also no monthly fees so long as you opt for eStatements as opposed to paper statements. Accessing your funds is also easy with Alliant, as it has an ATM network of 80,000 machines - five times the number Chase has.
We would compare the experience you will find at Alliant similar to that of Ally. Alliant only has branches in five states - California, Colorado, Illinois, Texas and Virginia - so if you don’t live in those, you will find a banking experience to be entirely online. Also like Ally, you can open up a high-yield checking account that lets you quickly transfer funds. Alliant also has a reliable mobile app that lets you to keep track of your funds on the go. The app does support mobile check deposit.
The biggest disadvantage to Alliant is that it is a credit union, which requires membership. As opposed to most credit unions, however, Alliant makes membership fairly easy. The traditional method would be to be apart of a recognized organization. If you are not, however, you only need to donate $10 to the Foster Care to Success organization.