Let’s face it: Most of us aren’t saving enough.
According to Federal Reserve Economic Data, the average American only manages to save 4.5% of their disposable income annually. With economic growth slowing and consumer prices going up, it's more important than ever to ensure your money is working harder for you.
That’s where a high-yield savings account (HYSA) comes to the rescue.
A HYSA leverages high interest rates to help you save more faster — which is perfect if you’re looking to set up an emergency fund or have a specific savings goal in mind.
Read on to find out what a HYSA is, the key benefits of high-yield accounts, and get some of the best HYSA deals in August 2025.
What Is a High-Yield Savings Account?
A high-yield savings account (HYSA) is a savings product that offers substantially higher interest rates than traditional savings accounts.
High-yield accounts work a lot like traditional savings products. You can link existing checking accounts, make deposits, and withdraw your cash when you need it.
But banks offer better annual percentage yield (APY) rates on HYSAs for a couple of reasons.
The best high-yield account providers tend to be online-only challenger banks. They don’t have physical branches, which means lower operating costs. To win business, those savings are then passed on to customers in the form of higher APYs.
High-yield accounts also tend to offer variable rates.
That means the rate you’re shown when opening an account may fluctuate when the Federal Reserve changes its base borrowing rate. Rates can also shift in line with demand and each bank’s respective growth strategy.
You should also bear in mind that some high-yield accounts have access limits.
For example, you might need to wait 1-2 working days to receive your funds after requesting a withdrawal. Many HYSA providers also impose monthly withdrawal limits.
What Are the Benefits of High-Yield Savings Accounts?
If you’re debating whether to set up a HYSA, here’s what makes high-yield accounts stand out:
Higher Interest Rates
The core benefit of a HYSA account is higher levels of compound interest.
According to the Federal Deposit Insurance Corporation, the average savings account yield in July 2025 was 0.38%. By contrast, some of the best high-yield accounts are paying over 4.00% APY.
That means you could earn up to seven times more on your deposit by placing it in a HYSA.
Low (Or No) Fees
Because many HYSA providers are online banks with few overheads, they can afford to drop monthly maintenance fees.
That makes saving cheap and simple.
Maintain Liquidity
A HYSA is an easy way to accumulate interest without sacrificing liquidity.
Unlike other high-interest savings products, the cash you deposit in a high-yield account is still accessible. Some online HYSAs take a couple working days to process withdrawals, but there’s a growing range of accounts that offer instant 24/7 access.
Low-Risk
There’s no such thing as a sure thing in markets. That’s one reason savers turn to HYSAs.
The FDIC insures all balances of up to $250,000. Even if your online bank goes bust, you’re not going to lose your deposit. That level of safety, paired with relatively high interest rates, makes high-yield accounts an attractive alternative to investing.
How to Open a High-Yield Savings Account?
Opening a high-yield savings account is typically a fast and straightforward process.
Here’s how it works:
1. Pick Your Account Provider
Start by shopping around. Create a shortlist of savings providers and products, then compare:
- APY
- Deposit requirements
- Account fees
- Access rules
Stack these features against your savings goals and access requirements. Then, go for the account that looks like the best fit.
Don’t be afraid to get in touch with providers to let them know you’re shopping around. They may pull out some extra incentives.
2. Apply Online
After selecting the high-yield account you’re after, it’s time to apply.
You’ll need to have documentation handy to complete the application. This will include your:
- Full address
- Social Security Number
- Driver’s license or passport
Most HYSA applications are online-only. They take a few minutes to complete, and approval is often instant.
3. Fund Your Account
After approval, you can immediately deposit money into your HYSA.
The easiest way to do this is by making an external bank transfer from an existing checking account. Some high-yield account providers will also offer ACH options.
After that, you can sit back, relax, and watch your savings build. Most HYSA providers compound interest and deposit interest payments on a monthly basis.
Which High-Yield Savings Account Is Right for You?
There are some attractive HYSA options available on the market in 2025.
To help you get started, here are some top picks that have no monthly fees:
- Axos ONE® Savings: 4.46% APY with $1,500 minimum balance.
- Peak Bank Envision Savings: 4.35% APY with $100 minimum balance.
- EverBank Performance Savings: 4.30% APY with $0 minimum balance.
- Bread Savings: 4.25% APY with $100 minimum balance.
- Openbank High Yield Savings: 4.20% APY with $500 minimum balance.
- CIT Bank Platinum Savings: 4.00% APY with $5,000 minimum balance.
- Barclays Tiered Savings: 3.90% with $0 minimum balance.
Remember: These are the tip of the iceberg. There are loads of HYSAs to choose from, and the best fit for you will depend on a few factors.
Go for an account that offers a minimum balance you’re comfortable with and accessibility rules that work for you. It’s also important to look at fees. And if you’d like easy and regular contact with bank staff, you might need to trade in the highest possible APY that online-only banks offer.
Popular Alternatives to High-Yield Savings Accounts
Not sure if a HYSA is right for your savings strategy? Don’t worry. There are several popular alternatives worth exploring:
Certificates of Deposit (CDs)
Certificates of Deposit (CDs) let you lock up your funds for a set term. This term can vary anywhere between three months and five years, and the rate is generally on par with a HYSA.
Unlike a high-yield account, a CD’s interest rate is fixed for the duration of your term.
The catch: your deposit is inaccessible. Early withdrawals often lead to large fees or account closure.
Money Market Accounts (MMAs)
A money market account (MMA) essentially combines the features of a checking and savings account.
MMAs offer debit cards and can make transactions like a checking account. They also offer higher APY than a traditional savings account.
In exchange for added functionality, the APY on an MMA is normally lower than a HYSA or CD. Minimum balances and monthly maintenance fees are also common.
Treasury Bonds
Treasury Bonds are another easy way to put idle cash to work without shouldering much risk.
As of August 2025, US Series I Savings Bonds (I Bonds) are posting an average rate of 4.24%. Returns are adjusted for inflation, which makes bonds a relatively safe investment. Just remember you can’t cash in a bond for 12 months — and if you cash in before the five-year mark, you’ll lose three months of interest.
Start Saving Smart
At the end of the day, a high-yield account is an easy way to generate high levels of interest on your savings.
There’s a wide range of HYSA products available that offer varying rates, deposit requirements, and access rules. So you should be able to find a solution that aligns with your savings strategy.
But don’t forget to shop around. And if a high-yield savings account doesn’t quite work for you, be sure to check out alternatives like CDs or MMAs so you can start cashing in on higher interest rates.
