With the Federal Reserve set to maintain current interest rates at the upcoming meeting, you have a longer opportunity to take advantage of the high returns available today before possible future rate cuts. High-yield savings accounts are still offering impressive rates of up to 4.40% APY through the weekend and beyond, which is over 10 times what traditional banks typically offer on regular savings accounts.
These high-yield accounts function just like regular savings accounts but come with two significant benefits: much higher interest rates and fewer fees. Online banks operate without the overhead costs of physical branches, allowing them to pass on these savings directly to you. Your money is still protected by FDIC insurance while earning significantly more each month.
Opening a high-yield savings account is a quick process that can be done online in just a few minutes. User-friendly mobile apps and banking tools make it easy to link your new account to your existing checking account, enabling seamless fund transfers, automated deposits, and effortless monitoring of your growing balance.
For the best high-yield, FDIC-insured accounts available this weekend, offering opportunities to maximize your savings with no monthly fees, check out the following options:
Today’s top CDs: Secure guaranteed yields of up to 4.40% before the next Fed meeting this weekend. High-yield savings rates for Friday, May 2, 2025: The highest savings rates for today are found at FDIC-insured digital banks and online accounts, providing up to 4.40% APY with minimal requirements at Valley Bank, Bread Financial, CIT Bank, and other reputable institutions as of May 2, 2025.
– Valley Bank Direct Savings: 4.40% APY with a $1,000 minimum for new customers
– Bread Financial High-Yield Saving: 4.35% APY with a $100 minimum deposit
– Barclays Bank Tiered Savings: Starting at 4.10% APY with no minimum balance
– CIT Bank Platinum Savings: 4.10% APY on balances of $5,000 or more
– Upgrade Premier Savings: 4.02% APY on balances of $1,000 or more
– SoFi Checking and Savings: Up to 3.80% APY and a cash bonus of up to $300 with direct deposit
– Discover Online Savings: 3.60% APY with no minimum balance
While these brands may not be as well-known as American Express, Capital One, or Discover, they are FDIC-insured online banks or partners with FDIC-insured institutions, ensuring your deposits are protected up to $250,000. Moreover, the transaction limits on high-yield savings accounts have been lifted indefinitely in response to the pandemic, allowing you to freely move money in and out of your account as needed.
For more details on how to find and open a high-yield savings account in five simple steps, and to compare traditional savings account rates, consider
On a basis point scale, the interest rates for various certificate of deposit (CD) terms have seen minimal changes recently. The rates for 3-month, 6-month, 12-month, and 24-month CDs have decreased by 1 basis point, while the rates for 36-month, 48-month, and 60-month CDs have remained unchanged.
The FDIC, an independent government agency, aims to uphold stability and public trust in the U.S. financial system by insuring consumer deposit accounts.
A savings account is a deposit account meant for storing funds not intended for regular expenses. It generally does not offer check-writing capabilities or debit cards, although some high-yield accounts may provide limited checking features. Savings accounts earn interest, with rates varying from 1% to over 4%, compounding to accelerate savings growth.
Simple interest is calculated solely on the principal amount, while compound interest includes interest on both the principal and accumulated interest. Higher compounding frequency leads to greater returns.
High-yield savings accounts can yield more interest compared to traditional savings accounts, and both types are federally insured up to $250,000, providing security for deposited funds.
Digital banks and online accounts offer higher interest rates compared to traditional accounts, with some accounts paying more than 10 times the national average. Leading digital banks like SoFi Checking and Savings provide up to 3.80% APY with no fees or minimum deposits, making it easier to manage your account long-term.
When deciding on a savings account, consider factors such as promotional rates, minimum balance requirements, ease of access to funds, and federal insurance protections. While high-yield accounts can offer rates as high as 4% APY, be aware that interest rates are variable and can change over time based on market conditions.
In addition to savings accounts, consider other options such as certificates of deposit (CDs), money market accounts, and high-yield checking accounts to maximize your savings and earnings. CDs offer fixed rates for a set period, while money market accounts provide competitive rates with limited access to funds. High-yield checking accounts combine checking benefits with high APYs and unlimited access to funds.
Stay informed about savings rates and high-interest accounts, as they are influenced by the Federal Reserve’s target interest rate. It’s essential to choose an account that aligns with your banking preferences and financial goals to maximize your savings potential.
The country’s central bank, known as the Federal Reserve (Fed), sets a benchmark interest rate that has a significant impact on various financial products such as deposit accounts, loans, mortgages, and credit cards. When the Fed rate increases, so do the Annual Percentage Yields (APYs) on savings accounts, certificates of deposit (CDs), and money market accounts. Currently, the best high-yield savings accounts are offering APYs exceeding 4%.
After raising the target interest rate 11 times between March 2022 and July 2023 to address the highest inflation levels in over four decades following the pandemic, the Federal Reserve made a highly anticipated decision to cut its federal funds target interest rate by half a percentage point on September 18. This was followed by two additional quarter-point cuts after the November and December policy meetings.
On March 19, 2025, the Federal Reserve paused its rate cuts for a second time during its policy meeting. The Fed announced that the federal funds target interest rate would remain steady within a range of 4.25% to 4.50%. This marked the second pause in rate changes since the three consecutive cuts in September, November, and December, which had collectively lowered the Fed rate by a full percentage point.
In its post-meeting statement, the Federal Reserve highlighted its commitment to achieving “maximum employment” and maintaining inflation at a target of 2%. The Fed acknowledged stable unemployment rates and solid labor market conditions but noted increased uncertainty in the economic outlook. The Fed stated that it would carefully evaluate incoming data, the evolving outlook, and risk assessments before considering any further adjustments to interest rates.
Economic projections released by the Fed indicated expectations for two quarter-point rate cuts in 2025, reflecting a cautious approach amidst a potentially slowing growth trajectory and persistent inflation concerns.
Looking ahead to the next policy meeting scheduled for May 6–7, 2025, market expectations suggest that the Federal Reserve will maintain the Fed rate between 4.25% and 4.50%. Analysts are closely monitoring inflation and labor reports to gauge the timing of potential future rate cuts. Recent data has shown a moderation in inflation rates and positive job growth figures, influencing the Fed’s decision-making process.
The inflation rate has decreased to 2.7%, indicating a trend of moderating inflation. Economists have welcomed this decline, but many are cautious about the potential impact of President Trump’s trade policies and the temporary pause on reciprocal tariffs, which could lead to accelerated price growth. Federal Reserve Chair Jerome Powell, speaking in Chicago on April 16, mentioned the challenges posed by the current trade environment on future Fed policy decisions, stating, “For now, we are in a position to wait for more clarity before considering any changes to our policy stance.”
The Federal Reserve, under Powell’s leadership, will announce its rate decision at the conclusion of a meeting scheduled for Wednesday, May 7, 2025, at 2 p.m. ET.
For more information on the Federal Reserve meeting schedule and its implications for your finances, familiarize yourself with key terms like Annual Percentage Yield (APY), Member FDIC, maintenance fees, minimum deposit requirements, and variable APY rates. Understanding these terms can help you make informed decisions about savings accounts and investments.
Reaching a significant milestone can present various financial opportunities that may help you secure a more stable financial future. You can explore avenues such as generating passive income, bolstering your retirement savings, or reducing high-interest debts. Check out our guide on the top five strategic moves you can make with $10,000.
What is compound interest? Compound interest involves earning interest not only on your initial deposit but also on the interest you accumulate over time. This powerful concept can enhance your savings by allowing you to earn interest on both your principal amount and the interest you accrue. The Annual Percentage Yield (APY) of an account represents the total interest you will earn on your deposit over a year, including compound interest, typically expressed as a percentage. Many High-Yield Savings Accounts (HYSAs) compound interest on a daily or monthly basis. Discover more about leveraging time to grow your wealth in our compounding guide.
Do savings accounts require tax payments? Yes, the interest you earn from your savings account is considered taxable income by the IRS. If you earn over $10 in interest within a calendar year, your bank or financial institution will provide you with a Form 1099 for inclusion in your annual tax filing.
Which is preferable: fixed rates or variable rates? There is no definitive answer to this question as fixed rates remain constant over time, whereas variable rates can fluctuate based on market conditions. The decision between fixed and variable rates often depends on the financial products available. Gain insights into the distinctions between fixed and variable rates and how they influence your borrowing and saving strategies.
How do banks profit from savings accounts? Banks typically earn revenue by charging higher interest rates on loans than the rates they offer on customer deposits. This margin, known as the spread, is fundamental to banks’ profitability. Online banks and digital accounts, which operate without physical branches, can offer even higher APYs by passing on their cost savings to customers.
Are online-only neobanks or digital accounts secure for my money? Yes, neobanks are financial technology (fintech) firms that collaborate with established FDIC-insured banks to provide deposit accounts protected by the government up to $250,000. The FDIC ensures the safety of your funds, even in the event of the neobank or fintech company’s closure. When considering banking options, look for terms like “member FDIC,” “FDIC insured,” or “NCUA insured” to verify your bank’s insurance coverage.
How does saving differ from investing? The primary contrast between saving and investing hinges on the accessibility of your funds and the associated risks. Saving involves keeping your money in secure accounts with minimal risk to your principal amount. Conversely, investing entails purchasing assets such as stocks, bonds, or mutual funds with the potential for higher returns. Explore further insights in our saving and investing guide to determine the most suitable strategy for growing your savings.
Please note: The Annual Percentage Yields mentioned were current as of Friday, May 2,
Bureau of Labor Statistics. Retrieved on April 7, 2025. CME FedWatch Tool, CME Group. Retrieved on May 2, 2025.
