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    • Today’s best savings accounts still pay the highest rate in two decades: up to 5.50%
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    Today’s best savings accounts still pay the highest rate in two decades: up to 5.50%

    Umito Posted on

    Key takeaways

    • The Fed cut interest rates by a quarter point last week, but most of the deals in our rankings best high yield savings accounts held on.
    • This includes Pibank 5.50%, which is just below the 23-year high rate of 5.55% recorded in April.
    • Newtek Bank And Open banking they also still pay exceptional rates, at 5.25%. And six other savings accounts offer rates of 5.00% or more.
    • Even though rates will fall with any new Fed decision, today’s savings accounts still pay among the highest rates seen since probably 2001.
    • Don’t miss out on this earning opportunity by keeping money in an account that earns next to nothing.

    The full article continues these offers from our partners below.

    Today’s 9 Best Savings Accounts Let You Earn 5.00% to 5.50% on Your Money

    With the Federal Reserve Last week, in announcing its widely anticipated rate cut, rates on a few savings accounts fell. But nine of the top 11 accounts from last week are still paying their bumper rates.

    Among them is the market leader Pibank, whose Pibank Savings the account offers 5.50%. Available to open with any deposit amount (even without initial funds), it also has no ongoing minimum balance requirements and charges no monthly maintenance fees. Although Pibank is relatively new in the United States, it is owned by brick-and-mortar bank Intercredit, which has been FDIC insured since 1984.

    Beyond Pibank, two other accounts pay exceptional rates. Both Newtek Bank And Open banking still offer their second rate of 5.25%, and neither has a permanent minimum balance requirement. But these aren’t your only great options. Our daily ranking of best high yield savings accounts includes six additional choices that will allow you to earn an annual percentage yield (APY) of 5.00% or more. By opting for one of these nine best accounts, you’ll access an elite level of savings rates.

    Prices on savings accounts surged last spring to its highest level in more than 20 years, hitting a record 5.55% in April. That’s thanks to the Federal Reserve’s aggressive rate hike campaign from 2022 to 2023, which aimed to bring down the highest interest rates in decades. inflation. Even though the Fed has since made two rate cuts, you can still earn income very close to the maximum savings rate.

    Advice

    You can find additional details on all the best high-yield savings accounts by visiting our daily roundup of the best APYs. We research rates from more than 100 federally insured institutions every business day to keep our rankings up to date.

    Best High Yield Savings Account Rates – November 12, 2024

    To qualify for our ranking, a bank or credit union must be federally insured by the FDIC or NCUA.

    Advice

    Are you worried that having savings in another bank might not be practical? Don’t worry. Online banking makes transfers between banks extremely easy. And even though the transfer process takes one to three days, you can manage that by not moving. all of your savings into the new account. Instead, keep a small reserve with your primary bank so you can make immediate transfers to a check if necessary.

    Will savings account rates fall?

    Savings accounts have variable rates, meaning the bank or credit union may change your interest rate at any time without warning. One of the main factors determining how institutions set savings account rates is the Federal Reserve’s benchmark interest rate, the benchmark interest rate. federal funds rate. Even though the banks and the Fed don’t move at exactly the same time on rates, they generally move in the same direction.

    Unfortunately for savers, the Fed has launched what is expected to be a series of rate cuts. The Fed cut the federal funds rate for the second time this year, lowering it by 0.25 percentage points on November 7. This follows a reduction of 0.50 points on September 18. A further cut could occur in December 2024, and further cuts would be likely in 2025. Each Fed cut that occurs would put downward pressure on savings account rates.

    But it’s good to keep some perspective. Even if, say, the best savings account rate goes from 5.50% today to perhaps 4.50% by the end of the year – or even 3.50% by the end of 2025 – these are still historically high returns. You can see this easily in the chart below, which shows that in 2022, before the Fed’s rate hike campaign, the APY on the the best paid the national savings account accounted for a measly 0.70%.

    What about the best CD prices of the moment?

    If you can commit to not touching part of your savings for months or years, now is the perfect time to open one of the best certificates of deposit (CDs)because they also pay historically high rates. While APYs are enabled new CDs will fall with the federal funds rate, so a CD you open now will have a guaranteed return that you can keep until it matures.

    Currently, you can lock in a rate of up to 5.50% with the best 6 month CDor up to 5.00% with the best one year CD. For terms from 18 months to 5 years, the best CD rates range from 4.30% to 4.65%, providing a rate guarantee that will last at least until late. 2026 and as long as 2029.

    But hurry if you want to open a CD. Like savings accounts, CD rates will be pushed down by any Fed rate cuts. So it’s best to secure a guaranteed CD rate as soon as possible.

    Daily ranking of the best CDs and savings accounts

    Note that the “highest rates” cited here are the highest nationally available rates that Investopedia has identified in its daily research of rates for hundreds of banks and credit unions. This is very different from the national average, which includes all banks offering a CD with this term, including many large banks that pay paltry interest. So, national averages are still quite low, while the best prices you can find while shopping are often five, 10, or even 15 times higher.

    How We Find the Best Savings and CD Rates

    Every business day, Investopedia tracks rate data from more than 200 banks and credit unions that offer CDs and savings accounts to customers nationwide and determines the daily rankings of the highest-paying accounts. To be eligible for our lists, the establishment must be federally insured (FDIC for banks, NCUA for credit unions), and the minimum initial account deposit must not exceed $25,000. It also cannot specify a maximum deposit amount less than $5,000.

    Banks must be available in at least 40 states to be considered nationally available. And while some credit unions require you to make a donation to a specific charity or association to become a member if you don’t meet other eligibility criteria (for example, you don’t live within a certain region or do not work a certain type of job), we exclude credit unions with a required donation of $40 or more. To learn more about how we choose the best rates, read our full methodology.

    Umito
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