Highest Savings Account Rates and the Fed Funds Rate

Another Fed meeting has come and gone with no interest rate hike but there is hope for the future for savings rates. Over the past year, we have already seen banks and credit unions increase savings account rates. In fact, this past month we have a new highest savings rate of 1.26 percent on our rate list.

Looking past this month, it's very likely savings rates and money market account rates will continue to inch higher. Pressure is mounting for the Fed to increase the fed funds rate and it's looking like that will happen during the Fed's scheduled December meeting.

When the fed fund rate is increased, it's likely the best savings rates from online banks will also increase. The current fed funds rate is in a targeted range of 0.25 percent and 0.50 percent. If the range is increased to 0.50 percent to 0.75 percent the top savings account rates could rise to 1.50 percent.

The last time we saw the top variable deposit rates at 1.50 percent was several years ago. You might be able to find a bank offering a promotional rate of 1.50 percent or higher but it's a limited time promotional rate.  You have to go back to right after the financial crisis around 2009/2010 to find deposit rates that high.

Highest Savings Rates

1. Popular Direct 1.25% APY 1.26%
2. Synchrony Bank 1.04% APY 1.05% (tied for 2nd place)
3. Goldman Sachs Bank USA 1.04% APY 1.05% (tied for 2nd place)
4. AloStar Bank of Commerce 1.04% APY 1.05% (tied for 2nd place)
5. Barclays Bank 1.00% APY 1.00% (tied for 3rd place)
6. Ally Bank 1.00% APY 1.00% (tied for 3rd place)
7. UFB Direct 1.00% APY 1.00% (tied for 3rd place)
8. Radius Bank 1.00% APY 1.00% (tied for 3rd place)
9. iGObanking 1.00% APY 1.00% (tied for 3rd place)
10. CIT Bank 0.95% APY 0.95% (tied for 4th place)
11. FNBO Direct 0.95% APY 0.95% (tied for 4th place)
12. Discover Bank 0.95% APY 0.95% (tied for 4th place)
13. American Express 0.90% APY 0.90% (tied for 5th place)
14. Pacific National Bank 0.90% APY 0.90% (tied for 5th place)

Highest Money Market Rates

1. EverBank APY 1.11% (promotional yield)
2. Dime 1.09% APY 1.10% (tied for 2nd place)
3. iGObanking.com 1.09% APY 1.10% (tied for 2nd place)
4. Capital One 1.00% APY 1.00% (tied for 3rd place)
5. California First National Bank 1.00% APY 1.00% (tied for 3rd place)
6. Pacific National Bank 1.00% APY 1.00% (tied for 3rd place)
7. ableBanking, a division of Northeast Bank 1.00% APY 1.00% (tied for 3rd place)
8. Sallie Mae 0.90% APY 0.90%
9. Synchrony Bank 0.85% APY 0.85% (tied for 5th place)
10. Ally Bank 0.85% APY 0.85% (tied for 5th place)