The first step in building a savings plan is making the decision to do so in the first place. Once you’ve crossed that threshold, the next step is deciding where to put the money. This means finding an account that offers competitive interest rates, low costs, limited restrictions and strong deposit protections.
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Many consumers find an account that checks some of those boxes without checking all of them. Rather than settle for less, you should find an account that meets all of the criteria. If you’re trying to build your savings, you’ll want to make sure your account does the following.
The one thing an account should always do is give you the best possible return on your deposits. The number to keep an eye on is the annual percentage yield, or APY. The APY is a formula used to calculate the amount of interest earned on an investment or on your account over one year.
The average U.S. savings account APY is 0.41% as of Apr. 21, 2025, according to the Federal Deposit Insurance Corp. (FDIC). But you should aim a lot higher than that. A high yield account can offer more than the national average, meaning your savings may grow faster.
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Some financial institutions may require a large opening deposit to earn high interest rates, or to even open a savings account. Before opening an account, make sure it has a low opening deposit requirement.
Another thing you should expect out of a savings account is that it doesn’t reduce your earnings by hitting you up with all kinds of fees every month. The point of a high-yield account is to grow your wealth, so it doesn’t make sense to pay monthly maintenance fees that reduce your wealth.
Many banks and credit unions waive these fees if you meet certain requirements, such as maintaining a minimum balance. But even that places restrictions on the account. Look for accounts that require no monthly maintenance fees, no matter your balance.
Speaking of minimum balance requirements, if you’re looking to grow your savings, you’ll want to look for an account that doesn’t require a minimum balance.
Some banks restrict the number of withdrawals you can make each month. These restrictions are designed to discourage customers from tapping into their savings accounts too often and to ensure the banks have enough cash reserves to operate.
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