What Is the National Average Interest Rate for Savings Accounts?

In 2025, the national average interest rate for traditional savings accounts remains surprisingly low — but that doesn’t mean your money should settle for less.

📉 What’s the Current National Average?

• 0.57% APY — According to Bankrate’s latest data as of July 22, 2025 BankrateYahoo Finance+3Bankrate+3Bankrate+3

• 0.38% APY — Based on FDIC’s nationwide average as of July 2025 Newsweek+6FDIC+6Forbes+6

These averages reflect the low returns typically offered by major brick-and-mortar banks and credit unions.

🧮 What This Means for You

To put those numbers in perspective:

• With $10,000 in a typical savings account earning 0.5% APY, you’d get only $50 in interest per year.

• In contrast, high-yield savings accounts from online or digital banks regularly offer 4.0%–5.0% APY, sometimes even higher Bankrate+4Bankrate+4Fortune+4.

That’s 8–10× more compared to the national average—and a difference of hundreds of dollars in annual earnings.

🚀 Why Rates Differ So Much

1. Big Banks vs. Online Banks
   Brick-and-mortar institutions have overhead costs that keep yields low. Online banks, with fewer expenses, can offer much better rates InvestopediaElite Finance+2Bankrate+2Newsweek+2.

2. Fed’s Benchmark Rate
   Savings rates tend to track the Federal Reserve’s target federal funds rate. Since the last Fed cuts in December 2024, most traditional yields have remained low, but top online banks maintain high rates around 4–5% Kiplinger+6Fortune+6Wikipedia+6.

3. Market & Competition
   Online institutions aggressively offer higher APYs to attract deposits, making them ideal places for savers to maximize earnings Kiplinger+7Bankrate+7Newsweek+7.

💡 Choosing a High-Yield Alternative

• Currently, leading APYs include 4.44% at Peak Bank Bankrate+15Bankrate+15Wall Street Journal+15 and up to 5.00% from top-name options like Varo Bank, AdelFi, Pibank, and Fitness Bank Fortune+3Investopedia+3Wall Street Journal+3.

• Other strong contenders: Synchrony (4.66%), Bread Savings (4.30–4.35%), and Newtek Bank (4.35%), all typically with no monthly fees Investopedia+3Wall Street Journal+3Kiplinger+3.

• These accounts often have no minimum balance requirements and are FDIC-insured, giving both safety and flexibility BankrateKiplingerWall Street Journal.

📊 Side-by-Side Snapshot