TLDR: Use Ally Bank (not affiliated per usual) because of their great customer service and amazing checking, saving, and money market accounts.
Besides making money while you sleep through your investment accounts, a high-interest bank can provide the same benefit.
But before getting into the recommended banks, you should make sure you understand the difference between savings and checking accounts:
Savings accounts earn you more money but have cash withdrawal restrictions while checking accounts make you less money but have little to no restrictions.
According to the Federal Deposit Insurance Corporation (FDIC), the average interest rate on savings accounts in 2020 was 0.06% [1] annual percentage yield (APY). This means that for every $10,000 you keep in an average savings accounts, you'd only be making back $6—a terrible deal in our opinion.
On the other hand, the suggested banks on this page have APY's of over 1% as of @October 12, 2020! That means for every 10,000$ you kept in their savings account, you'd make $100 a year—over 16 times the national average.
The banks that are able to provide 1% APY are almost always online banks, meaning that they do not have any physical locations. But, don't worry about having to withdraw money from ATM's. Almost all the online back options allow you to use any and every ATM you can find.
The one thing that you should be wary about online banks is customer support—an important consideration if you find yourself needed help with your accounts often.
Why you should choose Ally Bank
For most people most of the time, you should heavily consider Ally Bank. All of Ally Banks's financial accounts are FDIC insured, meaning that you (most likely) won't lose your money when the whole US economy crashes again.
Additionally, their customer service is excellent and they offer very competitive rates on all their services. As icing on top, Ally Bank's mobile app looks clean and functions well. For this guide's writers, Ally Bank has become the main hub for all their money storing needs. For a more in-depth look at Ally Bank, check out nerdwallets review.
Ally Bank's saving account—0.80% APY as of @August 20, 2020—is absolutely fantastic and fluctuates to match other banks' competitive rates. It has no monthly fee and no minimum deposit meaning that you can open an account today for free!
Remember, this guide isn't affiliated with Ally Bank or any other service we recommend. We do not make money from anything you sign up for in this guide! If you'd like to sign up for Ally Bank's saving account, you can click the box below:
Ally Bank also has a great checking account that provides a 0.10% APY as of @August 20, 2020. Like their savings account, their checking account has no monthly fee, no minimum deposit to open an account, and you get free access to over 43,000 ATMs nationwide with your Ally Bank debit card.
Combined the best of both worlds, Ally bank also a money market account with a 0.50% APY. This hybrid-account combines the features of both savings and checking accounts so that you get a great rate on your balance and still get check-writing and debit card access.
Ally Bank also offers more services like low-interest auto/mortgage loans, high yield certificates of deposit (CD), and more! To see everything they offer, check out Ally's Website.
The best online bank for you
If you don't like what Ally Bank has to offer or want to find an even better option, click the link below. Once you're there, you can search for the specific bank that best suits your needs!
The Automatic Millionaire