Big-Bank Savings and CD Rates (But You Can Earn So Much More)

If you hold your primary accounts at one of the largest U.S. banks, you certainly benefit from the convenience that comes from banking with a massive financial institution that has physical branches across the country. But when it comes to earning interest on your savings, you’re leaving significant money on the table if you stick only to your big bank.

That’s because you can earn a great deal more with one of the top high-yield savings accounts or best-paying nationwide CDs, most of which are offered by small- to medium-size banks, online banks, and credit unions. While you may not want to move your checking account and entire banking life to one of these other institutions, they’re worth a serious look for money you can sock away in an outside account.

Key Takeaways

  • Three of the five biggest banks pay meager savings account rates of 0.01% to 0.04% APY, with a fourth paying just 0.25% APY.
  • The top-paying savings accounts in the country offer 5.00% or more, with 15 options in our daily ranking of the best options paying more than 4.75% APY.
  • The biggest banks pay better rates on their CDs than their savings accounts, but you can still earn 1%-5% more by locking in a top rate of 5.00% or better with a nation-leading CD.
  • The longer the CD term you’re looking for, the more you stand to gain by shopping beyond the biggest banks.
  • Socking away money at another bank is not as inconvenient as you may think, since you won’t have frequent transactions in these accounts.
  • All FDIC-insured banks offer the same protection on your deposits, no matter their size or whether they’re online or physical.

Comparing Savings Account Rates of the Top 5 Banks

If you’re a long-time customer of a big bank, you may ask yourself if it’s worth moving some of your money elsewhere, since it involves adjusting to a new setup that incorporates an additional bank. But on savings accounts, the answer to whether it’s worth it is a resounding yes. In fact, you may be shocked at the difference between what you are earning at your big bank and what you could be earning with a high-yield savings account.

Savings account rates from the five largest consumer banks in the U.S. (ranked by assets) are shown below. These five banks account for more than a third of all deposits held by all FDIC-insured banks, so millions of Americans are represented by them.

As you can see, only Citi pays an even remotely competitive interest rate on its best savings account, currently 3.85% APY. Meanwhile, Chase, Bank of America, and U.S. Bank are paying almost-negligible rates of 0.04% APY or lower. And while Wells Fargo outdoes those three by several multiples, it’s still only paying 0.25% APY.

In stark contrast, you have numerous opportunities to earn in the high 4% range or even up to 5.07% APY with options from our daily ranking of the top-paying savings accounts. While we limit the list we publish to the top 15-20 accounts every day, our rate database shows that 50 different nationally available savings accounts currently beat Citi’s rate of 3.85% APY.

Let’s take a look at how that adds up with an example of what happens if you hold $5,000 in savings for one year.

 Savings Account Rate (APY)  Earnings in One Year 
U.S. Bank 0.01% $ 0.50
Chase 0.02%  $ 1.00 
Bank of America  0.04%  $ 2.00 
Wells Fargo  0.25% $ 12.50 
Citi 3.85% $ 192.50
Nationwide leader 5.07% $ 253.50

Comparing CD Rates of the Top 5 Banks

If you won’t need to access a chunk of cash for awhile, you can do quite a bit better with the big banks’ certificates of deposit (CDs) than with their savings accounts. But even though all five top banks pay a somewhat reasonable rate on 6-month CDs, ranging from 3.00% to 4.30% APY, you can earn at least 5.00% APY from almost two dozen CDs in our daily 6-month CD ranking, with a current top rate of 5.50% APY.

If you’re looking for longer CD terms, the gap between what the big banks pay and what you can earn from smaller players begins to widen. Four of the five big banks pay a not-terrible rate on 1-year certificates. But for a 2-year term, only three pay a rate between 2.00% and 3.00% APY, while the national leader pays a significantly higher 5.25% APY.

It gets even worse as you move to longer-duration CDs, with three of the five big banks paying as little as 0.10% APY—or worse—on 3-year CDs, and 0.25% APY or less on 5-year CDs. Even for the two big banks paying a more reasonable rate, their returns are 2%-3% lower than the industry leader, or even 4% lower on the Chase 5-year option.

Using an example of a 2-year CD with a $10,000 deposit, here’s how your earnings from the different options stack up.

 2-Year CD Rate (APY)  Earnings Over 2 Years 
U.S. Bank 0.05% APY $ 10
Chase 2.00% APY  $ 404 
Citi 2.50% APY $ 506 
Bank of America 3.00% APY  $ 609 
Nationwide leader 5.25% APY  $ 1,077 
Wells Fargo doesn’t currently offer a 2-year CD.

Moving Your Savings to Another Bank Is Safe and Easy

If you’ve always held your checking and savings at a larger bank, you may be concerned that it will be less safe at another bank, or that having funds at two different institutions will be inconvenient. But these are easy worries to dispel.

Federal Protection Is the Same for Banks of All Sizes

All FDIC banks are equally insured against bank failure. Each depositor is covered for up to $250,000 in deposits at each FDIC institution where they hold funds (and at each NCUA-insured credit union as well). So you are no more or less protected at a small vs. a large bank.

This also applies to online banks. Many of the online banks you encounter in our rankings are internet divisions of existing physical banks, but even internet-only institutions are FDIC insured. Just look for the words “FDIC Member” or the FDIC logo on the website of any bank where you’re planning to do business.

Using Multiple Banks is Easier Than You May Think

It’s true that having your money at more than one bank will involve transferring funds between them. But with today’s online banking interfaces, this is extremely easy to do. Transfers do typically take one to three days to appear in the receiving bank, but as long as you don’t move money that you’ll need within that time frame to your outside savings account, the process is simple and convenient to manage.

It’s also very easy to set up automated transfers from your primary account to your outside savings account, if, you are putting away a certain amount each month to reach a particular savings goal.

CDs are even better suited for being held at another bank, since you don’t transact with the account until it matures. Opening a CD at another bank involves one initial transfer to open the account, and then just one more transfer when you cash out. Since there won’t be ongoing transactions, you’ll barely have much interaction with your CD bank other than receiving statements and, when maturity is approaching, directing the bank on how you want your CD balance handled.

Still Only Feel Comfortable with a Bigger Bank?

If you’re still not persuaded that it’s worth moving some of your savings where it can earn a top nationwide rate, or if you just feel you’ll sleep better with your money under the roof of a really big bank, it’s worth considering that some large institutions pay much better rates than others. Above we considered the five largest banks by assets, but within the top 25 largest banks, there are some options where you can earn a reasonably competitive rate.

Big Banks That Offer Competitive Rates U.S. Rank by Size (Assets) Savings Account Rate (APY) 1-Year CD Rate (APY) 3-Year CD Rate (APY) 5-Year CD Rate (APY)
Marcus by Goldman Sachs 8 4.15% 4.75% 4.30% 3.80%
Capital One 9 3.75% 4.15% 4.30% 4.10%
Ally Bank 20 3.75% 4.50% 4.25% 4.25%
BMO Harris 21 4.50% 5.10% 4.30% 4.30%
American Express 23 3.90% 4.25% 1.15% 3.00%
Discover Bank 26 3.90% 4.75% 4.30% 4.00%
Nationwide Leader 5.07% 5.25% 4.85% 4.68%
Source: FDIC, Banks by Total Domestic Deposits, December 31, 2022.

Note that most of the above are online-only accounts, though Capital One and BMO Harris also operate physical branches. As we’ve pointed out, however, this shouldn’t cause concern for money you’ll only access when you are cashing out.

Rate Collection Methodology Disclosure

Every business day, Investopedia tracks the rate data of more than 200 banks and credit unions that offer CDs to customers nationwide and determines daily rankings of the top-paying certificates in every major term. To qualify for our lists, the institution must be federally insured (FDIC for banks, NCUA for credit unions), and the CD’s minimum initial deposit must not exceed $25,000.

Banks must be available in at least 40 states. And while some credit unions require you to donate to a specific charity or association to become a member if you don’t meet other eligibility criteria (e.g., you don’t live in a certain area or work in a certain kind of job), we exclude credit unions whose donation requirement is $40 or more. For more about how we choose the best rates, read our full methodology.

Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our
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