Every $10K You Keep in a BofA Savings Account Costs You a New Pair of AirPods Every Year
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BoA's standard savings account pays just 0.01% APY, which means $10,000 earns you a whopping $1 per year. That's barely enough to buy a game from the App Store.
Meanwhile, high-yield savings accounts (HYSAs) from online banks are offering rates as high as 4.00% APY or more. For the same balance you'd earn $400 each year in interest. That's enough to buy a brand-new pair of AirPods (every year) and still have money to spare.
I've been writing about savings accounts for years, and I personally earn 4.00% APY on my savings. If you're with BofA right now earning pennies on a large cash balance, here's how to fix it.
How much you're really losing with BofA
There's a reason Bank of America has millions of customers. Branches are on every street corner, they feel familiar, and they've built decades of trust.
But all that size and convenience comes with huge overhead -- and that's one reason big banks are notoriously stingy when it comes to interest rates. Seriously, 0.01% APY is a joke.
On the other hand, online banks like American Express National Bank (Member FDIC), SoFi®, and CIT don't have thousands of branches to maintain. Much leaner operations allow online banks to offer way higher yields. Many are paying 4.00% APY or more right now for high-yield savings accounts.
Here's what that difference in interest looks like with just your savings balance:
| Balance | BofA (0.01% APY) | HYSA (4.00% APY) |
|---|---|---|
| $5,000 | $0.50 | $200 |
| $10,000 | $1 | $400 |
| $25,000 | $2.50 | $1,000 |
| $50,000 | $5 | $2,000 |
Even a small emergency fund can earn meaningful dollars in interest. You just need to move it to the right type of bank account.
Here's a great option you might like. Right now LendingClub offers 4.20% APY with $250+ in monthly deposits on its LendingClub LevelUp Savings account. Check it out below.
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LendingClub LevelUp Savings
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- Competitive APY
- No fees
- Easy ATM access
- Unlimited number of external transfers (up to daily transaction limits)
- Requires you to make monthly deposits to earn the best APY
- ACH outbound transfers limited to $10,000 per day for some accounts
- No branch access; online only
The LendingClub LevelUp Savings account has a lot to offer. At the top of the list is its high APY, though you must deposit monthly to earn the best rate. Next is zero account fees, a strong and straightforward perk. Finally, you get a free ATM card, which you can use to withdraw from thousands of ATMs nationwide. Interested? You can open an account with $0.
Are other banks just as safe?
Long story short -- Yep!
I used to keep all my money with Chase because it's massive, and that felt "safe." A lot of people feel the same about Bank of America, and I totally get it.
But the truth is most banks, no matter their size, offer the same FDIC protection. That means online banks and even some tiny fintechs are just as secure as the big guys.
FDIC insurance covers up to $250,000 per person, per bank on deposits in checking and savings accounts. Some credit unions offer NCUA insurance, which works the same way.
As long as you're choosing a reputable, federally insured institution, your money is protected just like it would be at Bank of America or Chase.
I moved my entire emergency fund (about $25,000) out of Chase and into a high-yield savings account a few years ago. I was nervous at first, but since then I've earned over $2,000 in interest. And because the money's insured, I sleep just fine at night.
How to choose a good HYSA
You don't need to completely ditch Bank of America. I still have my old big bank checking account and use it for direct deposit, bills, and everyday stuff.
But when it comes to storing extra cash -- like emergency funds, travel savings, home down payments -- a high-yield savings account makes a lot more sense.
Here's what to look for when picking a new bank to work with:
- A high APY (Around 4.00% APY is excellent)
- No monthly fees
- FDIC or NCUA insurance
- Easy transfers and access
- A user-friendly app
My HYSA right now is with Betterment. It's connected to my Chase checking account on the back end so I can do money transfers easily between my checking and savings accounts.
Ready to earn 400x more interest?
Switching where your savings lives might seem small. But it can have a massive impact over time
I used to ignore this APY stuff, too. But once I saw how much money I was leaving on the table, I couldn't unsee it. Moving just one chunk of savings from a 0.01% account to a 4.00% HYSA turns dead money into easy money.
You don't need to overhaul your whole financial life. Just open a high-yield account, link it to your checking, and let the interest start rolling in.
Before you know it, hello new AirPods!
See which banks are paying the highest APYs and start saving smarter today.
Our Research Expert
Joel is a full-time Personal Finance Writer at Motley Fool Money, known for his clear, approachable voice on topics like credit cards, savings hacks, and side hustles. He’s been writing about money since 2018 and previously managed editorial content for the How To Money podcast.