Which Savings Account Will Earn You The Least Money?

Explore why certain accounts pay out less and how to find the best one for your financial objectives. Discover the advantages and disadvantages of traditional and high-yield savings, online banking, and CDs. Read more on how to optimize your savings.
Which savings account will earn you the least money
Which Savings Account Will Earn You The Least Money?
Learn the complex world of savings accounts, demonstrating how some may yield less than you think. Discover the differences between standard and high-yield accounts and online banks and CDs.
In this article

Do you know certain savings accounts will earn much less than expected? Yes, unlike their names, they don’t help you save more.

Compared to traditional brick-and-mortar banks, online banks, high-yield savings accounts, and CDs offer better returns on cash. Find out more on which savings account will earn you the least money.

The higher interest rates on savings accounts than those on checking accounts make saving more convenient. However, savings accounts must catch up with inflation as they pay less interest than other investments, like stocks and CDs. Try using the Beem App for high yielding savings account.

Let us learn in detail about savings accounts and their difference due to the interest rates they offer. With proper guidance, you can select a suitable savings account for the future.

Which Savings Account Will Earn You The Least Money?

The savings account that will likely earn you the least money is a traditional savings account at a brick-and-mortar bank.

Here’s why:

  • Low Interest Rates: These accounts are known for offering the lowest interest rates on the market.
  • Fees: They may have monthly maintenance fees and other charges that can reduce your earnings further.
  • Accessibility: While easy to open and use, their convenience comes at the cost of earning potential.

What is the Problem with Low-interest Savings Accounts?

Savings accounts and certificates of deposit are no longer generating attractive interest income. Hence, customers use their money to pay down debt or invest in goods, services, or assets, such as houses and stocks, resulting in lost deposits. 

People who live off the interest income from their savings also suffer from low interest rates, so they cut back on spending. Economic activity will slow if many people, such as baby boomers and retirees, reduce spending. That can result in a reduction in sales for you.

Why Do People Choose Low-interest Savings Accounts?

People primarily choose low-interest savings accounts because they place a higher value on accessibility than earnings. Using low-interest savings accounts is often more accessible and convenient than other types. 

The low-interest rate environment means that consumers will have more money to spend. It means they will also be more likely to borrow money, driving up the demand for household goods. Banks charge different rates based on how much their deposits are needed.

The fact is that many big banks have plenty of funds and don’t need any more. 

Government stimulus checks boosted household income. However, household spending dropped, increasing savings. Banks continue to pay low interest rates to savers to maximize profits.

How to Choose the Correct Savings Account?

Your best savings account will depend on your financial situation and savings goals. It also depends on how you want to access it. A traditional savings account can be opened in a branch, or if you prefer to do it online, you can open an online savings account and manage it electronically. 

There is no need to commit long-term. Interest rates usually drop after a year, so it makes sense to shop around. The first thing you should do when you open a fixed-rate savings account is to set a calendar reminder for the end of the introductory interest rate.

If the rate does not end, you can set a one-year reminder. Also, Saving money in various saved accounts is a good idea if you can lock away a large sum of money while saving regularly over time. 

What are the Benefits of High-yield Savings Accounts?

The best place to keep your cash savings for emergencies and short-term financial goals is in a high-yield savings account. The following are some of the benefits of opening a high-yield account:

  • While interest rates now hover around 1%, this is still higher than the 0.06% return you’d earn kept in a bank savings account.
  • With these savings accounts, you’re earning interest daily, and you don’t need to start with much money to accumulate savings. 
  • Savings accounts compound interest daily, so you earn interest each day and only need a little money to start.
  • Savings accounts that offer the highest yields are usually online, so you can manage your money on the go through mobile banking apps.
  • With the high-yield savings account, savers can quickly transfer their money to other bank accounts.

For those looking to explore beyond traditional and high-yield savings accounts for even more options to optimize their savings, our in-depth guide on alternatives to high-yield savings accounts offers valuable insights into other viable options for growing your money.

What are the Disadvantages of Traditional Savings Accounts?

The most traditional savings accounts are liquid, meaning you can withdraw your money anytime without a fee. Your financial goals may be met with something other than a conventional savings account, even if it seems reliable.

Interest rates are low

Traditional savings accounts indeed offer interest and the possibility of growth, but these returns are small. Interest rates on most standard savings accounts are usually around 1 to 2 percent, which only amounts to a few monthly dollars.

A fee may be charged

Many credit unions and banks, including Mountain America, offer free savings accounts with checking accounts. Others will charge you to open or maintain the account. Make sure you ask about any fees before you open an account.

Your taxes won’t be reduced

Traditional savings accounts will not save you money on taxes like IRAs and certificate accounts. You already pay income tax on the money you deposit into a standard savings account—and you also have to pay tax on any interest you earn.


Select the correct savings account to avoid losing money and incur significant opportunity costs. Evaluating your financial goals and needs before selecting a savings account is essential. In this way, you can choose the account that suits your needs and maximize the earnings on your money.

Savings accounts can make or break your finances, so choosing the wrong one can cause much damage. Make your choice wisely by doing your research. Invest in yourself now, and you’ll be glad you did. Check out how much interest you could earn with Beem.


What is the lowest amount for a savings account?

An opening deposit of $25 is required to open a checking account with U.S. Bank. There is a monthly maintenance fee of $4, but the fee can be waived if you maintain a balance of $300 daily or $1,000 monthly. Members of the military and customers ages 24 and under and those 65 and over pay no monthly maintenance fee.

Which bank has the lowest minimum balance for a savings account?

Axos Bank Rewards Checking is a valuable account offering several outstanding features, such as no monthly maintenance fees and minimum balance requirements. Many online banks also offer no minimum balance savings accounts.

What is the best type of savings account to earn money?

High-yield savings accounts—typically found at online banks- offer a higher APY than regular ones. It is one of the best savings accounts to maximize your money’s growth.
Online banks often offer different types of high-yield savings accounts to attract savers who want to earn a better interest rate than what is found at brick-and-mortar banks and credit unions.

Which bank is best for a small savings account?

The best savings accounts are online banks, which offer much more attractive offers and benefits. It is also easier to navigate unique policies and offers of banks online. One can also select a credit union for savings to grow funds better.

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Allan Moses

An editor and wordsmith by day, a singer and musician by night, Allan loves putting the fine in finesse with content curation. When he's not making dad jokes or having fun with puns, he's constantly looking to tell stories out of everything.


This page is purely informational. Beem does not provide financial, legal or accounting advice. This article has been prepared for informational purposes only. It is not intended to provide financial, legal or accounting advice and should not be relied on for the same. Please consult your own financial, legal and accounting advisors before engaging in any transactions.

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