5.25% APY is the new savings rate to beat

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• The highest rate on the market right now for savings accounts is 5.25%.
• As rates climb, it’s not unusual to see an APY over 5%, but this is a new high.

High-yield savings accounts are now paying up to 5.25% APY.

In fact, there are two accounts currently paying that rate.

The first is Betterment’s Cash Reserve, which is offering the 5.25% APY exclusively to new customers (the regular rate is 4.50% APY). Betterment is available nationwide, and is an online-only platform that also provides investing services. There are no fees or minimums on the account, and the rate for new customers is offered through the end of the year.

The second is Milli, which offers 5.25% APY on its Savings Account. There is no minimum balance requirement to earn interest. You just need to download the Milli app.

Milli is a mobile-only platform backed by the FDIC-insured First National Bank of Omaha. Its Savings Account pays a high rate and has a savings tool called Jars. Jars help you save and track up to five specific financial goals, and you’ll earn 5.25% for the balance in each Jar. Meanwhile, its Spending Account comes with a debit card and is primarily for managing your expenses, but doesn’t pay interest. 

See Insider’s best savings accounts »

Other financial institutions offering over 5% APY

Savings interest rates have gone up over the last few years as a result of decisions made by the Federal Reserve. The Federal Reserve has raised interest rates several times in 2022 and 2023 to combat inflation. 

The average savings account pays 0.42% APY, according to the FDIC. However, many online banks pay significantly more than this. While Milli pays the highest savings rate right now, other banks aren’t far behind:

• Western Alliance Bank High Yield Savings Account, powered by Raisin: 5.15% APY
• Bank5 Connect Jumbo Savings Account: 5.10% APY

If you’re looking for a savings account from a popular online bank, you can still find savings rates that are well above the national average. Here are some institutions that offer competitive rates:

• Synchrony High Yield Savings: 4.50% APY
• SoFi Checking and Savings: Up to 4.40% APY

When choosing a high-yield savings account, you’ll want to pay attention to more than the interest rate. Minimum balance requirements, monthly service fees, and accessibility to the account may also impact your decision. Furthermore, make sure that your account is federally insured by the FDIC or NCUA. These federal agencies protect up $250,000 per depositor for bank accounts.