5% Interest Savings Accounts: Where You Can Get 5% on Your Savings Nationally (2024)

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The best high-yield savings accounts pay well above the average savings account rate of 0.46% APY (Annual Percentage Yield).

In fact, 5% savings accounts are now available at numerous financial institutions. This means a savings account paying 5% APYallows you to earn 5% on money kept in the account over the course of a year.

How to qualify for a 5% interest rate

To earn 5% APY on a savings account, you might need to meet certain requirements on a monthly basis. Here are the most common qualifications needed to qualify for 5% APY on a savings account.

Balance requirements

Some savings accounts have a tiered interest rate based on your account balance. This means your interest rate can differ depending on how much money you maintain in your account.

Typically, the best 5% interest savings accounts offer a higher interest rate for lower account balances and reduce the interest rate significantly if you keep a high account balance. If you maintain a high account balance, you might prefer a bank account that offers the same APY regardless of your account balance.

Direct deposit requirements

A direct deposit is money you receive that goes directly into your bank account. Direct deposit requirements are another requirement that's often listed for savings accounts with tiered interest rates.

Direct deposits must be received monthly, or you might earn a lower interest rate for that month.

Banks will specify which direct deposits are considered "eligible" to qualify for savings rate perks. Usually, payroll and government benefits are considered eligible direct deposits. The amount you must deposit will also vary depending on the institution.

Promotional periods

You might also find savings accounts that temporarily offer a higher interest rate for the first few months of opening an account. These offers are to attract new customers who are considering opening a new bank account.

Membership eligibility

To open a high-yield savings account at acredit union, you must be a member. Some credit unions, like Digital First Credit Union, limit membership eligibility to customers who live in a certain area, work at a participating employer, or belong to a local participating organization.

Although not as common, banks may also limit who is eligible to open a bank account. From our list, Ivy Bank doesn't permit California residents to open a bank account.

Pros and cons of 5% interest savings accounts

Are you trying to decide between a 5% interest savings account and another interest-earning option? We've outlined the pros and cons of these high-yield savings accounts so you can decide if they're a good fit for you.

Pro: High APY

A 5% interest savings account is a type of high-yield savings account. High-yield savings accounts are similar to traditional savings accounts you'd find at brick-and-mortar banks, but they offer more interest.

High-yield savings offerings are also more commonly found at online-only financial institutions than places that have a physical branch presence.

Pro: Financial security

All accounts listed are federally insured by the FDIC or NCUA for up to $250,000 per depositor, per ownership category.

Federal insurance protects consumers' insured deposits if a bank fails. Your insured deposits will either be moved to another federally insured financial institution or sent to you in the form of a check. The FDIC and NCUA also work quickly to ensure consumers have access to their money as soon as possible and communicate updates.

Con: Potential rate changes

A 5% interest savings account has a variable interest rate, which means the rate can fluctuate over time.

Banks can decide to change rates for any reason, but often, you'll see banks with more competitive savings rates when the Federal Reserve decides to raise the federal funds rate. If the Fed implements rate cuts, savings rates often decline.

Con: Limited accessibility

While you can choose to take money out of a savings account at any time, banks can place a six-per-month transaction limit. Therefore, some banks may charge a fee for each transaction that surpasses the six-per-month limit, while others don't. You'll have to check with each financial institution to see if it enforces a transaction limit for savings accounts.

Con: Fees

Savings account fees vary depending on where you bank. You might be charged a fee each month to maintain an active account, receive paper statements, or make withdrawals that surpass the free monthly transaction limit (if it's enforced).

Is a 5% interest savings account right for you?

When comparing 5% interest savings accounts, think about which features you prioritize most. Consider the following factors to help determine the right option for you:

• Opening requirements:See how much money you need to open an account. If you're looking at credit unions, check if you're eligible for membership.
• Interest rate requirements: Some savings accounts have certain requirements to qualify for the highest interest rate, or have a tiered interest rate system where the rate will change for various account balances. Review the criteria for earning interest.
• Fees: Common fees for savings accounts include monthly bank maintenance fees, bank paper statement fees, and excess withdrawal fees. View the schedule of fees if available online, or call a bank to learn about fees.
• Online/mobile banking:Find out if the bank has mobile or online banking services. Also, review mobile app ratings in the Google Play or Apple Store.
• Additional features offered:Some savings accounts come with unique features, like ATM cards or savings goal features. If these matter to you, prioritize a savings account with these perks.
• Other banking options:If you're considering opening other bank accounts with the same company, you might prefer an online bank or a credit union. Investing platforms typically do not offer many bank account options.

Tips for maximizing your 5% interest savings

Consider implementing the following strategies to maximize your interest earnings on a 5% interest savings account.

Set up automatic transfers

Setting up automatic transfers can help make sure you are prioritizing some of each paycheck toward your savings. In some cases, it may also be a requirement for earning the highest APY.

Establishing an emergency fund

In general, high-yield savings accounts are a good place to grow and maintain anemergency fund because you are earning interest over time. Furthermore, it may be a better fit than a checking account, because you are typically not making daily expenses from a savings account.

5% interest savings accounts

The following list includes over 20 online banks, credit unions, and investing platforms with savings accounts offering at least 5% interest. If a specific institution has certain requirements for earning 5% APY, we explain the limitations, below.

Digital FCU is limited to people who live in select areas of Massachusetts, live in a New Hampshire participating condominium community, work for a Select Employer Group, or belong to a local participating organization. Ivy Bank is available to anyone in the United States except California residents.

5% interest savings FAQs