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Are You Earning Your Bank’s Best Savings Rate? See if You’re Missing Out on Interest

Your rate may not be the same as when you first opened the account.

When your bank advertises a competitive savings rate, you may think that same offer extends to your existing account. But that’s not always true -- a lesson some Capital One customers with older savings accounts recently found out.

Capital One, which has topped our savings account best list over the past year, has been advertising high savings rates for most of 2023 and 2024. But this rate applied only to the bank’s 360 Performance Savings accounts, which some customers with 360 Savings Accounts realized too late. Not knowing your actual savings rate could cost you tens to thousands in interest, depending on your account balance.

With savings rates expected to drop later this year, paying attention to your account’s rate can help you maximize your interest earnings.

Headshot of Leslie Tayne
Leslie Tayne, financial attorney and founder of Tayne Law Group

“Interest rates can fluctuate due to factors such as changes in the economy, monetary policy decisions by the Fed, the credit market and more,” said Leslie Tayne, founder of Tayne Law Group and CNET Money Expert Review Board member. “Unless you’re putting your money in a certificate of deposit or other time deposit account, it’s important to understand that your rate is not fixed and may go down in the future.”

If you want to get the most out of your savings account in 2024, here are four tips Tayne suggests incorporating into your financial routine.

Don’t take advertised rates at face value

The rate that you see advertised for your bank may not be the rate you’re earning. Several factors can impact that.

First, since savings rates are variable, they can change at any point. “The rate you were offered when you first opened your account may not be the same today or a year from now,” Tayne said.

And just because your bank is offering a high APY doesn’t mean it automatically applies to your account. You might have a different type of savings account open at your financial institution that doesn’t qualify for the higher rate. Or you may need to meet certain account requirements to earn that rate.

The best way to verify how much your account is earning is to review your statement.

If you realize you’re not earning the highest rate your bank is offering -- or if you’re earning much less than competitors are offering -- you can always ask your bank for a savings rate increase. Your bank is under no obligation to match a competitor’s rate, but it never hurts to ask. You might even find your bank has a different savings account with a higher rate that you can easily move your money into.

If your bank won’t raise your rate, consider finding a better fit for your savings. While moving money from a savings account earning 4% to one earning 4.25% is unlikely to make a huge impact on your savings goals, if you’re earning near zero or far less than the top savings rates, making a switch can add more to your bottom line.

Check in on your account APY regularly

“The best way to verify how much your account is earning is to review your statement,” Tayne said. You can also check the account details on your bank’s mobile app. “This tells you how much your balance earns each year based on your interest rate and the frequency that interest compounds,” Tayne said.

The more frequently your bank compounds interest, the more you can earn on your savings. If you have a 5% savings account at a bank that compounds interest daily or monthly, you’ll accrue slightly more interest than a similar account that compounds quarterly or annually.

You may want to repeat this process monthly or quarterly, since this rate can change without warning. This will be particularly important toward the later half of 2024, once the Fed begins dropping rates.

Even when rates drop, keep your high-yield savings account 

When savings rates dip later this year, don’t abandon your high-yield savings account. Savings accounts are still a solid spot to regularly contribute to short-term goals or emergencies. And most importantly, you’ll have access to your money, penalty-free. 

Regardless of where rates go next, your best bet for earning a higher rate on your savings is to steer away from banks with near-zero rates and monthly fees. 

“Sticking with big, national banks can be a mistake if you’re looking to earn the best rates possible on your savings,” Tayne said. “Large banks don’t have to compete as much for customers, so they tend to offer below-average rates on savings accounts. You may be better off with a credit union, online bank or neobank.”

Move money for long-term goals to higher reward accounts

If you have savings earmarked for goals years or decades into the future, a savings account could limit your earning potential. 

Although high-interest accounts can help you earn more than you would with a traditional savings account, they’re generally not the best place to put your money for long-term goals like saving for retirement,” Tayne said.

Deposit accounts simply aren’t going to generate enough of a return to build your wealth adequately.

If you’re not already contributing to a tax-advantage retirement account, like a 401(k) or IRA, start there. If your employer offers a match, do what you can to maximize your contributions to get the most out of this workplace benefit. If your workplace doesn’t offer retirement accounts, or if you’re self-employed, you can open a Roth IRA on your own.

After that, you can explore other types of Investment accounts, like exchange-traded funds or index funds. These types of accounts have more risk but typically come with better long-term outlooks for your money. 

With stock market returns averaging 10%, Tayne suggests adding them to your savings portfolio when you’re ready. “Deposit accounts simply aren’t going to generate enough of a return to build your wealth adequately,” she said. 

Dashia is a staff writer for CNET Money who covers all angles of personal finance, including credit cards and banking. From reviews to news coverage, she aims to help readers make more informed decisions about their money. Dashia was previously a staff writer at NextAdvisor, where she covered credit cards, taxes, banking B2B payments. She has also written about safety, home automation, technology and fintech.