How much can you earn with today’s top savings account?

After the Federal Reserve raised interest rates, savers now have an opportunity Increase their savings balance And maintain easy access without taking any risk. But to do that, you have to choose The right type of savings account.

Traditional savings accounts, typically offered by large national banks, still earn below 1% APY in many cases. Actually, the national average The savings account rate is currently just 0.42% APY. But with high yield savings accounts Online Bank Many can earn 10 times or more with yields between 4.5% and 5% APY. Depending on the amount you save, these higher interest rates can make a significant difference to your balance over time.

Find out how much more you could earn with today’s top savings rates.

How much can you earn with today’s top savings account?

For many savers, especially those new to saving, the APY percentage alone may not mean much. We’ll use a few examples below to illustrate how much you can earn today Highest paying savings account.

Let’s say you have a savings balance of $5,000 — just under The median for the American family As of 2019, the most recent data — and decide to deposit it in a high-yield savings account. These accounts have variable interest rates, but if we assume current rates hold for the next twelve months, here’s what your account balance will be after a year of saving if you earn Today’s top rate:

• Popular Direct 5.05% APY: $5,252.50
• Salem Five Direct 5.01% APY: $5,250.50
• CIT Bank 4.95% APY: $5,247.50
• UFB Direct 4.81% APY: $5,240.50

A big advantage of high-yield savings accounts is the ability to contribute over time and quickly grow your savings balance.

Consider a situation where you deposit $10,000 into an account earning 4.95% APY upon opening, but you contribute another $200 each month to your savings. At this rate, you’ll have a balance of about $12,948 at the end of the year — including both contributions and interest earned on your cash.

See how much you can earn with some of the highest earning savings accounts now!

How to make the most of high yield savings

The first thing you can do is if you want to make the most of your savings Open a high-yield savings account Now with a great rate.

It’s easy to get overwhelmed by the myriad options for high-yield savings today, says Trent White, CFP, founder of Omnia Wealth Management.

“If you’re identifying the effort to put your cash into something with a high yield, you’re a lot further ahead than leaving it in a checking account where it’s probably not earning any interest and its value is reduced by inflation,” White says. .

Top-earning is any number Online Savings Account You can help meet your goals, but you can lose If you spend too much time on a decision instead of finding an account that works for your needs.

“Make a decision and go with it, then don’t look back for a while. Have peace of mind that your money is working for you,” says White.

Even small differences in yield won’t make as big a difference as developing good savings habits will in the long run.

“Saving money takes discipline and time. Be patient, make saving easier, and then let time take its course,” says Jane Mepham, CFP, founder of Elgon Financial Advisors.

Set a savings goal – whatever it is emergency fund Or just a $500 starting point — and then start putting aside what you can each month. Experts recommend setting up Automatic transfer To simplify the process.

Get started by comparing today’s top savings rates and start earning more now.

Bottom line

Savers today have a big advantage thanks to the large number Competitive high-yield accounts With flexible terms and no fees. Depending on your savings balance, you could earn hundreds of dollars in interest a year at today’s high rates. To make the most of them, don’t wait to get started. No one knows what the future holds for interest rates, but the sooner you start saving, the sooner you can start reaching your savings goals. Start by comparing the top savings rates you can qualify for today.