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A great way to save money is in a savings account, better yet, in a high-yielding savings account, where there is a potential for your money to grow.

The best and top saving accounts are those offering high annual percentage yields. The higher the APY, the more money you will have at the end of your savings period.

But where can you find the best saving accounts for 2021?

I’ve analyzed and rated various banks and credit unions according to their APYs, fees, and minimum balance requirements.

Now that most of the work is done for you, you’re left with choosing the bank that carries the best features for you.

Ready to choose the best saving account for you?

Let’s dive in!

Best Saving Accounts and Rates Worth Considering

1. Barclays

barclays

Barclay bank does not offer a checking account, but a very hefty interest rate on its savings account is worth considering trusting your savings.

It is an online-only bank operated in the US and tends to around 48 million people worldwide. 

Its APY of 0.4% with no minimum balance gives you the potential to grow your money and monitor your saving goals with a tool it provides.

The APY provided is claimed to be five times higher than the national average.

Below, I summarize its features in term of pros and cons:

ProsCons
It provides a highly competitive savings rate.It does not offer a checking account.
There is no requirement for a minimum balance to open the account.It is an online bank only, so anyone looking for personalized customer service might not be very comfortable with it.
The non-sufficient funds' fee is also minimal ($5) than other banks charging up to $30.It does not allow cash deposits or cash withdrawal from ATMs, which might be troublesome for anyone with just one checking account.

Barclays savings mobile App has made monitoring of your savings effortless. You can easily view your current balance, bank statement, interest, and all transactions from the tips of your fingers.

APY: 0.40%

Minimum balance: None

Monthly fees: None

App available: Yes

Consistently high APY combined with no monthly maintenance fees and discrete tools to help you save more makes Barclay's savings account number one on our list of top savings accounts.

2. NBKC Bank

nbkc-bank

NBKC Bank is an FDIC-insured online bank with its physical branches only present in Kansas City, Missouri.

The NBKC Everything account is a hybrid account infusing both checking and savings accounts, aiming to provide you with an easy-to-use account for all your needs charging no fees.  

You require no minimum balance to open an Everything account and start enjoying 0.25% APY on all your credit.

You can easily create big or small saving goals and fund them instantly from your checking account. The same APY applies to all your saving goals too.

Let's shed some light on its pros and cons:

ProsCons
It provides a reasonably good APY on all your balance.It does not offer overdraft protection.
There are no fees charged in the name of an overdraft fee, maintenance fee, or foreign transaction fee.It is an online bank except for its branches available in Kansas.
It easily allows you to determine, set, and track your savings goals.Customer support hours are limited.

With an Everything account, you will have the comfort of managing your finances from a single account, unlike all other banks.

If you do not wish to withdraw from your savings account for a minor emergency, you can always set up a new saving goal under the name of an emergency fund or mini-vacation, etc.

APY: 0.25%

Minimum balance: None

Monthly fees: None

App available: Yes

3. Alliant

alliant

Credit Unions are known for their higher interest rates compared to traditional banks.

Alliant Credit Union offers an exceptionally high APY on its High-rate savings.

You can enjoy a fantastic APY of 0.55% provided there is a minimum $100 balance in your account. However, it does not charge a monthly fee if you opt for eStatements.

Once you are an Alliant bank member, it allows you to open 19 savings accounts to meet your specific savings goal.

You can quickly transfer money between your savings account and other Alliant or Non-Alliant accounts and manage all of this in a fuss-free manner with Alliant mobile banking.

Here are some of its pros and cons:

ProsCons
It provides above-average APY on its savings as well as checking accounts.It has a considerably high overdraft fee ($28)
It has an extensive (80,000) network of free ATMs.There are membership criteria that need to be fulfilled to enjoy these perks.
Mobile banking is very optimized.Shared branching is not facilitated.

Although all credit unions have membership criteria to meet, Alliant's standards are not very rigorous.

One can quickly tick off all requirements to become a member and start enjoying a generous APY on all his savings.

APY: 0.55%

Minimum balance: $100

Monthly fees: None if you select eStatments

App available: Yes

Alliant Credit unions ensure to provide the best APY with easily attainable membership criteria and a vast network of Free ATMs, making it among the top three of our Best Savings Account list.

4. Quontic Bank

quontic-bank

Quontic is a digital bank offering a high-yielding savings account as one of its best financial products with 0.55% APY, bringing it on the top of Bankrate's Top online banks 2020.

Its headquarters are in Manhattan.

There are no monthly service fees charged, but the minimum opening deposit is $100, after which you can open your account in a matter of minutes.

All you need to provide is your date of birth, social security number, and contact info to start your account.

There are over 90,000 free ATMs available at your convenience, while its mobile app has made 24/7 access possible too. You can manage your expenses from anywhere.

Let's look at its pros and cons:

ProsCons
It offers a highly competitive APY on its high-yielding savings account.It has limited access to its ATMs, which is available in NY.
A vast network of free ATMs is available nationwide. 
Opening an account is fuss-free, fast and only requires $100 

APY: 0.55%

Minimum balance: $100

Monthly fees: None

App available: Yes

Quontic Bank's current interest rates on savings accounts are highly competitive and worth considering it as a long-term parking spot for your money.

There are no monthly fees, and opening an account is effortless and quick after you deposit a $100 minimum amount.

These highly attractive features have made Quontic's high-yielding savings account one of the best on our list.

5. Axos

axos

Axos bank is another eminent name in the world of internet banking.

It was initially known as the Bank of Internet USA and is FDIC insured to eliminate ambiguity concerning its legitimacy.

Two of its widely used products are high yielding savings and checking accounts associated with no monthly fees.

Since it is an online platform, Axos has maintained a strong online presence with its online-only customer service 24/7, safe online chats, and phone lines.

Now, let's jump to the best part.

Axos’s high-yielding savings account has an 0.61% APY associated with it, one of the finest in the market. 

However, you need to make a minimum deposit of $250 to get started with the process.

It does not charge any monthly fee from its client and frees them from keeping a minimum balance in the account.

Let's see it in the light of the pros and cons.

ProsCons
No monthly fee is applied.It has stringent requirements for APY on checking accounts.
It offers highly competitive APY.Only two branches are currently available.
Excellent rewards and ATM fee reimbursement options are given.CD rates are low as compared to other online banks.

APY: 0.61%

Minimum balance: Zero

Monthly fees: None

App available: Yes

Axos Bank is FDIC insured, providing one of the finest APY on its high-yielding savings account with tremendous potential for your money to grow.

6. Service Credit Union

service-credit-union

Service Credit Union has its headquarters in New Hampshire. Trusted to provide a range of financial products to its members, the Service credit union also ensures a personalized experience for its clients.

Every person has different financial needs and goals, it believes. And so it claims to provide unique services and resources to reach those goals efficiently.

You need a minimum of $5 to open a savings account. The annual percentage yield is 5.00% for a balance of $0.00 to $500.00 and gets to 0.25% for $500.01+

Its checking accounts enjoy more competitive rates as compared to the savings account. However, you can better appreciate the perks at Service credit union if you are an acting or former military person living in New Hampshire.

Here are some pros and cons I found:

Pros ✅Cons ❌
There is no monthly maintenance fee.It offers comparatively lower rates on Savings.
There are special programs available for military and government employees with more incredible perks. 
It takes part in shared branching. 

There are so many more options than you can explore under the Service credit union's savings account, such as Share savings, Youth club, Military savings, holiday club, etc., and place yourself in the suitable category.

APY: 0.25%

Minimum balance: Zero

Monthly fees: None

App available: Yes

It is another exceptional feature provided by the Service credit union, and that is financial knowledge with valuable resources to help you make wise financial decisions.

You can enroll yourself in a training course or speak to a financial wellness counselor. 

All these reasons are worth considering their service and placing it at number six on the list.

7. PenFed Credit Union

penfed-credit-union

Pentagon Federal Credit Union, also known as PenFed Credit Union, provides financial services, including Savings accounts, to primarily military-affiliated members. However, its benefits extend to others too.

Its premium online savings account offers 0.50% APY, but you can not expect the same from its basic savings account. The APY on a basic savings account is low (0.05%) compared to many other banks.

For both Premium and Basic, you require only $5 to open an account, and there are no monthly fees associated, rendering it a stress-free and effortless process.

However, the premium account is only accessible online, while the primary account is available online and at the branch.

PenFed has relatively easy terms to become a member, and its mobile app makes online banking quite convenient for all its clients.

Let's have a look at some of its pros and cons:

Pros ✅Cons ❌
It offers a very competitive APY on its premium online savings account.It provides low APY on its basic savings account.
It has a wide range of free ATMs available.It does not participate in shared branching.
It offers a good APY on its checking account as well. 

APY: 0.50%

Minimum balance: Zero

Monthly fees: None

App available: Yes

The National Credit Union Association federally insures the savings accounts at PenFed for up to $250,000, so you can easily trust them with your money and earn huge rewards with an exceptional APY on their premium online savings account.

8. Wealthfront Cash Account

wealthfront-cash-account

Wealthfront Cash Account formerly acted as a high-yielding savings account, but it has recently added some checking account features to the account as well, such as credit and debit cards.

This account acts both as savings and checking account, so if you will keep both accounts separate, it might not work best for you.

The minimum amount you need to open an account is $1, and there are no monthly charges applied.

Wealthfront's cash account is FDIC insured for a balance of up to $1 Million and provides a relatively competitive APY of 0.35% on your balance.

Some pros and cons of this two-in-one account are:

ProsCons
This account has features of both checking and savings accounts.It is a digital bank, so there are no physical branches.
The account opening amount is minimal, and there are no monthly charges.It does not allow you to overdraw the money from your account.
With its Autopilot option, it will direct your extra money towards the investments automatically.There is a $2.50 fee applied for using out-of-network ATMs.

APY: 0.35%

Minimum balance: $1

Monthly fees: None

App available: Yes

For anyone seeking to make financial management easier, Wealth front cash account is a significant consideration. It allows you to earn an APY of 0.35% on all your balance while availing of debit and credit card facilities.

However, it is a digital bank only and might not suit many accustomed to personal visits to banking affairs.

9. Capital One

capital-one

The Capital One 360 Performance Savings Account is one of the best FDIC insured accounts for a reasonable APY and no monthly and minimum charges.

With 0.40% APY, it stands in the top tier of most banks.

The more you put in your savings, the more you will earn and whatever you earn is what you get to keep since there are no monthly charges deducted.

It has a very well-developed and easy-to-navigate mobile app to make mobile banking a wholesome experience for you.

You can create, manage, analyze, and operate all your accounts from a mobile app from the comforts of your home.

Capital on a savings account has also introduced a digital savings tool to automatically boost your savings and ensure you meet your savings goal quickly.

Here are some pros and cons:

ProsCons
It provides high interest rates with no monthly fees.It has high overdraft charges.
No minimum balance is required to open an account.The accounts are primarily dealt with online.
Its mobile app is optimized with tools to increase your savings. 

APY: 0.40%

Minimum balance: None

Monthly fees: None

App available: Yes

You can easily define your savings goal on its mobile app and opt for automatic transfers to keep your savings within a healthy limit.

A decent APY, zero opening and maintenance charges, coupled with excellent customer facilitation, makes Capital One 360 Savings account worth considering for your hard-earned money and on number nine on our list.

10. American Express

american-express

Last but not least, we have American Express bank with an experience of over 170 years in banking.

It offers High-yield savings account with no minimums and no fees.

Its APY is also 0.40% which helps your money grow your FDIC insured savings account at American express.

American Express takes customers' support and facilitation extra seriously and has ensured superior customer service available around the clock.

American Express does not offer a checking account, so anyone looking to have savings and checking accounts at the same bank might be disappointed.

Let's have a look at some pros and cons of banking at American Express:

ProsCons
It provides a reasonable interest rate on savings with no monthly fee deducted.It does not offer a checking account.
There is also no requirement for a minimum balance to earn interest.It is not possible to deposit cash.
It has powerful and friendly customer support.There are no mobile apps available for banking in this bank.

APY: 0.40%

Minimum balance: None

Monthly fees: None

App available: Yes

Customers using the savings account option of this bank do not have access to the mobile app, which is only available for credit card customers.

American Express savings account is best suited for people who are only interested in a high-yielding savings account, with no intention of making cash deposits, and are comfortable with an online-only bank.

How I Chose The Saving Accounts On This List

The list of the best savings accounts for 2021 e, and their sequence was determined carefully after a rigorous comparison between many popular and high-performing banks.

I compared 36 banks in terms of:

  • Fees
  • Minimum requirements 
  • APY
  • Customer experience
  • Availability  

I then ranked them according to the total score got based on these five factors. 

While ranking the savings accounts, I gave special consideration to their fees and APY because these two features can directly affect your savings and the amount you earn on them.

My goal was to make the entire process of choosing a bank for your savings account stress-free.

How To Choose The Best Savings Account?

Whether you are trying to create a safety net for emergency events or saving up for your next big vacation, everyone finds a need to look for a good savings account at least once in life.

Knowing what to look for in a savings account is essential since this is where your stored money will remain safe and gradually grow.

Here is what to look for in the best savings account:

High APY

You are not putting your money in the savings account solely for keeping it safe. Your actual intention is to make your money grow.

It can only happen when the savings account you are opting for provides a high annual percentage yield. The greater the APY, the more amount you will earn on your savings.

APY rates vary from bank to bank, but every bank specifies APY it offers and the time it applies for.

Low Fees

Another significant thing to consider is the fees.

There are many fees associated with an account, the most common one being the maintenance fee.

The maintenance fee is usually not too much. 

On average, it is $4 or $5, but some banks do not deduct any monthly fee.

There are ways you can avoid fees.

If you keep a minimum amount in your account or link your savings account with another account, you can waive the fees.

Some banks also charge you if your account balance falls below a minimum limit.

Keep a close check on these conditions when you are selecting a savings account.

Easy Withdrawals

Savings accounts have certain withdrawal limits.

You can usually make six “convenient” withdrawals per month from your savings account. 

These typically include the transfers you make through bill pay, online, via phone, or writing a check.

When you exceed the withdrawal limit, you are charged a fee, or your excess may be disrupted.

There is a limit to the number of withdrawals because of a federal law called Regulation D. 

The bank uses the amount you put in your account in various projects like home mortgages, credit lines, loans, etc.

Only a tiny portion of the balance is held in your account. That is why there is a limit to the number of times you can withdraw from the bank.

When choosing a savings account for yourself, look for banks with easy withdrawal policies.

FDIC Insurance

Another significant factor to consider in your savings account is to see if it is FDIC insured.

It ensures that an independent agency is safeguarding your money in case of a bank failure or theft.

The maximum amount covered in a qualified account by FDIC is $250,000.

FDIC covers savings accounts too.

So, if you want to have some peace of mind knowing that your money is safe no matter what happens, always look whether the savings account you are choosing is FDIC insured.

Sign-up Bonuses

Sign-up bonuses are another added feature you can look for in a savings account.

Many banks come up with amazing sign-up bonuses after you meet specific requirements. These bonuses can be as good as $200.

It is exclusive of the bank, but some extra cash hurts no one, so you can also look if a bank offers sign-up bonuses to set you off on a brilliant start.

Types of Savings Accounts

Savings accounts are broadly into four categories.

While there are more, these are the most common:

Individual

An individual savings account is typically tax-free savings account for long-term use. 

It means that you do not have to pay income tax or capital gains tax from this account.

Each tax year, the amount you can put in your savings account is capped, and if you have over one savings account, this amount applies collectively to all your accounts.

Joint

A joint saving account works the same way as an individual saving account. 

The significant difference lies in the number of named account holders who can deposit and withdraw money.

Two or more people can open joint savings accounts while still maintaining their accounts. 

It’s best to open a savings account in the circumstances when you and your partner both save up for expenses like a car payment, house mortgage, etc.

Payable of Death

A payable death (DOP) savings account is a bank account named for the beneficiary of an individual who has opened the account.

It means that the said beneficiary will inherit the money in the account after the account holder's demise; however, while he is still alive, the beneficiary is not entitled to any money.

UTMA/UGMA

UTMA stands for Uniform Transfers to Minors Act, and UGMA stands for Universal Gifts to Minors Act.

Parents make these accounts to save up for their children, and until the child is an adult, they hold complete control of all activities of the account.

A parent can only withdraw money from these accounts if they are the custodians, and the funds will be used on the minor's behalf for their benefit.

Typical Fees for Savings Accounts

The most common types of fees associated with the savings account are the monthly maintenance fee and excessive withdrawal fee. 

However, there are ways to avoid both consciously.

For most brick and mortar banks, the monthly fees are $4 to $5, which covers the branch maintenance and personalized services.

One way to waive this fee is to have a checking and savings account in the same bank. Another common means is to maintain a minimum balance in the account.

You should be mindful of avoiding the monthly fee, especially if your savings account has a low APY because a monthly fee of $4 can cut deeply on the interest earned on your balance.

Online savings accounts with no physical branch rarely charge a monthly fee or minimum balance; however, their excessive withdrawal fee is higher than traditional banks.

It can range from anywhere between $5 to $20.

Federal regulations typically allow six withdrawals per month and begin charging a fee for any above that. 

A few banks do not charge a fee but completely deny any further withdrawal after the allowed six.

There are many incidental fees as well, depending on your banking habits.

These include:

  • Overdraft Fee
  • Stop Payment Fee
  • Returned Item Fee
  • Paper Statement Fee
  • Annual and Inactivity Fee

With reasonable knowledge and conscious banking habits, you can save yourself from any unnecessary fee and avoid a dent in the interest earned on your savings which is already a meager amount.

How to Save With Your Savings Account

Opening a savings account is not enough.

You still need to find ways to make the best use of it.

Whether your savings account is dedicated to an emergency fund or college, it is essential to ensure you are consistently contributing and effectively analyzing your savings.

Banks nowadays offer smart tools to give you a bird's-eye view of all your savings and spending, helping you make wiser decisions.

For example, auto-transfer is one of the most effective ways to transfer money from your checking into your savings account to save automatically.

You can also leverage mobile apps to view account balances, make payments and important transfers on the go.

Now that you're armed with savings accounts that have high APYs, low fees, and low minimum account requirements, you're ready to choose the best savings account for 2021 and the years to come.

Frequently Asked Questions

What is a Savings Account?

A savings account is a deposit account offered by a bank or a financial institution like credit unions, where the money you place bears some interest.

The interest rate on a savings account may vary from bank to bank, but they are FDIC insured and proved a reliable place for you to park your money for either long- or short-term saving goals.

There is often a limit to the number of times you can withdraw from a savings account, but most banks offer flexible options, making them suitable for your emergency needs.

You can always link your checking account to your savings account and opt for Auto-transfer to ensure all your money bears exceptional interest.

How Does Savings Account Work?

The amount deposited in the savings account or any other deposit account is used by the bank or credit union to fund other projects and provide loans.

It is the primary reason every brick and mortar and online-only banks offer savings accounts. 

The interest rate offered on a savings account is not usually fixed and can be altered by the financial institution unless stated otherwise.

Some accounts require maintaining a minimum balance, while most do not. 

However, it is always best to know the terms to avoid being charged.

Is Money Safe in a Savings Account?

Keeping your money in a savings account is highly safe because the FDIC insures most savings accounts for up to $250,000. 

It means that if you have $250,000 or less in your account and the bank goes out of business, the FDIC will reimburse your money.

Similarly, the savings account offered by credit unions is also guaranteed by NCUA.

What Are The Different Savings Accounts?

Knowing how many savings accounts exist can help you make a wiser decision tailored to your financial needs and goals.

Typically, there are six types of savings accounts.

Traditional Savings Account

Traditional savings accounts are the most common saving product offered at any bank or credit union. They are interest-bearing accounts, but the interest rate is usually moderate and varies from bank to bank.

A traditional savings account has a limit of withdrawal which is six times a month.

High-yield Savings Account

A high-yield savings account offers competitive APY with minimal-to-no fees.

They are typically digital accounts operated through mobile banking. Just like traditional accounts, these accounts can also be FDIC and NCUA insured.

Money Market Accounts

Money Market accounts combine both savings and checking account features and are offered both at traditional and online banks.

These are well-suited to people who want more access to their balance while still enjoying an interest.

Certificate of Deposit Account

Certificate of deposit accounts is like typical accounts, but they are time-bound deposits. It means that the amount placed in these accounts will remain inaccessible to you before a scheduled time.

During this time, the balance earns interest, and the CD matures, after which the owner can withdraw his savings.

Cash Management Account

Cash management accounts are not like typical accounts. They let you hold and earn interest in the money that you intend to invest.

Many Robo-advisors platforms and online brokerages offer cash management accounts.

Specialty Savings Account

Specialty savings accounts are made to meet specific savings goals. They are also often specialized for a person. Common Specialty accounts include:

  • Kids' savings accounts
  • Custodial savings accounts
  • Student savings accounts
  • Christmas Club savings accounts
  • Home down payment savings accounts

A few banks and credit unions offer such accounts.

When to Use your Savings Account?

The sole purpose of a savings account is to save!

Therefore, unless the reason to withdraw money is not very acute, you should not use your savings account unnecessarily.

However, a savings account also means you have something to rely on when grave circumstances arrive.

Use your savings account when:

When You Have Reached Your Savings Goal

If you were saving for a yearly vacation or any other goal and reached your desired amount, you can withdraw your savings without guilt.

When Emergency Strikes

You may not plan to use your savings account for a set period, but you might have to face unforeseen circumstances now and then. 

The most common ones include medical emergencies. 

It’s smart to build a rainy-day fund with your savings accounts and use it to help you get through unexpected expenses.

Online Savings Account vs. Traditional Savings Account

Online savings accounts have grown in popularity because of their convenience coupled with a comparatively high APY compared to a Brick and Mortar bank.

Online banks also offer an ATM fee reimbursement, meaning that a client can use any ATM knowing that any fee charged will be given back.

Like traditional banks, online banks do not have to worry about maintaining branches and paying many employees; they charge fewer fees than traditional banks.

However, online banks do not offer as much convenience in depositing money as traditional banks do. 

You can go to your bank's branch and deposit the amount you want while on the online bank this process is rather lengthy.

Similarly, if you expect personalized customer support, you can walk into a traditional bank and have all your questions answered. 

An online bank may not have 24/7 customer support.

What Is the Difference Between a Checking and a Savings Account?

A checking account is an account you hold for your daily transactions, paying bills, doing groceries, and shopping. 

You can access it through a debit card, paper checks, and even online in most cases.

There is usually no limit to the number of times you can make transactions from your checking account and withdrawing cash from ATMs (although there can be a specific daily limit).

A savings account is designed for a long-term saving goal, and your access to it is not as direct as a checking account.

It is wise to have a checking and savings account in the same bank so that you can quickly move cash between the two in case of emergency or to ensure a direct monthly deposit to your savings.

To make frequent withdrawals from your savings account, you may have to move money to your checking account first.

Savings accounts usually hold higher interest rates than checking accounts, but it may vary from bank to bank. 

However, both accounts may charge you a certain amount for not maintaining a specific amount.

How Does the Federal Reserve Affect Saving Account Rates?

The interest rates on savings accounts are directly affected by the rates that the Federal reserve sets.

If the central bank lowers its rate, the banks are bound to reduce the high-yielding savings account's interest rates. 

Why Would the Fed Lower its Interest Rate?

The Federal Reserve lowers its interest rate to stimulate economic growth. 

With lower interest rates, investors are more likely to borrow and invest.

Under these conditions, the bank also lowers the interest rate on saving products.

The Federal Reserve increases interest rates when the growth is optimal. It directly affects the interest rates on savings accounts as well.

How Much Interest Will I Get on $1000 a Year in a Savings Account?

The greater the amount you can save in your account, the more money you will make on it.

If you save $1000 a year in a savings account that offers 0.01% APY, you will end up with $1000.01 by the end of the year.

In a high-yielding savings account, the same amount can earn you $5 by the end of one year.

It is the reason you should opt for a high-yielding savings account providing the highest APY so that you can make most of the interest rate.

Where Can I Get 10% Interest on My Money?

Regular savings accounts typically never offer a very high interest rate.

A high-yielding savings account is a good option, but you can still not expect a 10% return on your balance.

However, there are other ways to earn a 10% rate of return on your investment.

Consider other options like:

However, you can count on the following banks to give you the most competitive interest rates currently:

  • Alliant Bank
  • Quontic Bank
  • Axos 
  • Service Credit Union
Author

Founded Financially Well Off back in 2018 with the intent of making finance relatable. Quality content. Quality Advice. For people looking to be financially well off.

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