Best 5% Interest Savings Accounts [Or More]

It used to be that you had to work hard to find ways to get close to 5% interest on a savings account. But today, there are many online banks and savings accounts that are paying 5% (or more) interest - many times without fees or "hoops" to jump through. If you're looking for great ways to boost your savings, this is the list for you.

Given that the national average for savings rates is just 0.47% according to the FDIC, getting 5% or more is a huge win. Remember, the more interest you can earn, the more passive income you'll have to grow your wealth.

Let's break down the best 5% interest savings accounts and banks for your money.

Best 5% Interest Savings Accounts

Here are the best 5% interest savings accounts to open an account with today:

1. AlumniFi Credit Union - Up To 5.00% APY

AlumniFi Credit Union is an online banking brand of Michigan State University Federal Credit Union, a National Credit Union Administration (NCUA) member. This means that deposits made into AlumniFi Credit Union's digital checking and savings accounts are eligible for up to $250,000 of NCUA deposit insurance. Its accounts and financial tools are geared specifically to college and university grads. 

To open an account, you must either:

1. AlumniFi Membership is available if you live, work, worship or attend school in the State of Michigan.
2. Join the Desk Drawer Foundation, a 501(c) organization that supports community non-profits.

The AlumniFi Savings account is a high-yield savings account with no monthly maintenance fees. Current APYs are as follows: 

Read our full AlumniFi Credit Union review.

Open an Account at AlumniFi Credit Union >>

2. Varo - 5.00% APY

Varo is an online bank that offers a high-yield savings account. While this bank is online, it offers a lot of the same features you'd expect from a traditional bank.

Plus, you don’t pay monthly fees and there are no account minimums.

Right now you can earn up to 5.00% APY.

Varo has a two-tiered savings account. You start earning 3.00% APY, then you can qualify to earn 5.00% APY¹.

What you need to know:

• There’s no minimum balance to open a Savings Account or a minimum balance to earn interest. Though, interest is paid out in whole cents only.
• You’ll start earning 3.00% APY and if you do a few extra things during each Qualifying Period², you’ll earn 5.00% APY on that portion of your balance up to $5,000.
  • Get one or more direct deposit(s) totaling $1,000 or more³;
  • Have $0.00 or more in your Varo accounts at the end of the Qualifying Period⁴.

Additional balances above $5,000 will earn Varo’s base 3.00% APY.

Check out our full Varo Bank review here.

Other 5% Interest Accounts (CDs and Checking)

There are some other accounts that are offering 5% interest, but all of these have "catches". Some of these are Certificates of Deposit (CDs). These are term deposits, that mean that you have to keep your money in the account or you could face a penalty. 

The other popular option here is high-interest checking, which are special checking accounts that pay promotion high rates IF you meet certain terms and conditions (like a certain balance or transaction amount).

Finally, there are "pay to earn" options, where you can get a higher rate if you sign up for a promotional or Gold level-type account. We don't list those here because they're not great options!

Consumers Credit Union Rewards Checking - Up to 5%

Consumers Credit Union is our top pick because of their awesome Rewards Checking Account that offers an amazing interest rate on your checking account. It also puts them on our list of the best credit unions!

Right now, you can earn up to 5.00% APY on your checking account for the first $10,000. The account also has no fees, no minimum balances, and reimburses your ATM fees.

However, you do have to meet some criteria:

Earn 3.00% APY

• Receive eDocuments.
• Complete at least 12 debit card purchases totaling $100 or more each month. Debit card transactions can be made with or without using your personal identification number (PIN).
• Direct deposits or ACH credits totaling $500 or more must post to your account monthly.

Earn 4.00% APY

Meet the 3.00% requirements plus:

• Spend $500 or more in CCU Visa credit card purchase transactions each month; no minimum number of transactions.

Earn 5.00% APY

Meet the 4.00% requirements plus:

• Spend $1,000 or more in CCU Visa credit card purchase transactions each month; no minimum number of transactions.
• There’s no minimum balance to open a free checking account. CCU has over 30,000 ATMs and you’ll receive unlimited reimbursements for any ATM fees. There’s also no limit on the number of checks you can write.

If you don’t meet the above requirements for a tier, your checking will still be free, but your APY will drop to 0.01%. You also don’t receive ATM refunds.

Read our full Consumers Credit Union review here.

Learn more about Consumers Credit Union Rewards Checking here >>

What To Know About Choosing These 5% Interest Accounts?

The biggest factor when choosing a savings account is simply the interest rate. The higher the annual percentage yield (APY), the better.

For example, if you have $10,000 to save, a 1% interest rate only will earn you $100 per year. But a 5% rate will 5x that to $500 per year. That's a big difference!

Here are some other key factors to consider:

Monthly Fees

You want to make sure that you're avoiding accounts with monthly fees. Fees eat into your return - the higher the fees, the less you earn overall. Most savings accounts don't charge monthly fees.

Is Your Money Safe And Insured?

You want to make sure that your bank is FDIC Insured, and your credit union is NCUA insured. These government safety nets provide up to $250,000 per individual, or $500,000 jointly in insurance. That means that you can't lose money if you're under those limits - even if your bank fails.

Minimum Balance Requirements

You also want to understand the minimum balance requirements - both to open an account and earn interest. Many accounts on our list simply have a $1 requirement. However, others (notably CDs) have $1,000 minimum or higher. 

Sometimes, banks will allow you to open an account for $0, but you won't earn any interest until you reach another level - like $10,000. Always make sure you check.

Minimum Transaction Requirements

This applies specifically to high-interest checking, but make sure you understand if any transactions are required to earn the highest interest rate.

Why Should You Trust Us?

The College Investor has been actively tracking the best savings rates since 2018, with a daily updated list that monitors roughly 50 banks and credit unions that have a history of great rates. But we also are always scouting out other banks that may compete on this list.

Unlike other well-known companies who create "best rate lists", we strive to put out rates in order highest to lowest so that you can know you're actually getting the best rate. And if you don't make the cut, too bad. You can find the full list of our bank review here.

Who Is This For?

If you're shopping for a new bank account for your savings, this list is for you. We curate the highest yielding accounts so that you can ensure you're earning the most interest possible.

We put this list together because we saw too many comments on social media about how there are "no accounts over 5%", when that's simply not true. People just struggled to find them, and some of the biggest companies don't post the best rates on their lists - they only show sponsored ads. As a result, consumers were not getting the best rates possible.

Final Thoughts

Five percent interest rate accounts are out there, and they're becoming more and more common as the Fed Funds Rate rises. It may seem too good to be true, but it's legit.

It's also important to remember that this has happened before. In the 1980s, savings account rates reached 10%. So that could happen again as the government tries to combat inflation. 

Always be shopping around for the highest rate savings account. That's how you'll earn the most interest on your money.