Savings Account Interest Calculator

Last updated July 2, 2026

Savings account interest has become meaningfully relevant again after a period in which rates hovered near zero. As of 2026, competitive high-yield savings accounts (HYSAs) offered by online banks are paying 4 to 5 percent APY, compared to the national average of approximately 0.45 percent at traditional banks. The difference on a $30,000 emergency fund is approximately $1,050 to $1,500 per year in interest earned at HYSA rates versus $135 at the national average — a gap of $915 to $1,365 per year for simply keeping the same money in a different institution. Over five years, that compounding difference exceeds $5,000.

The mechanics of savings account interest are simpler than investment returns: the stated APY already accounts for compounding frequency, so comparing accounts by APY produces an apples-to-apples result regardless of how often each institution compounds. Interest earned in taxable savings accounts is reported as ordinary income in the year earned, regardless of whether it's withdrawn. The IRS threshold for Form 1099-INT reporting is $10 of interest per year — effectively every meaningful savings account holder receives one. For those in the 22 to 24 percent marginal bracket, the after-tax return on a 4.5 percent HYSA is approximately 3.4 to 3.5 percent — still meaningfully above inflation, making the HYSA a genuinely wealth-preserving instrument for emergency and short-term savings.

Comparing savings account rates by APY, not by stated rate or compounding frequency. Move your emergency fund and any short-term savings to a competitive HYSA if you haven't already — the interest difference between a traditional savings account and a competitive HYSA is $900 to $1,500 per year on a typical emergency fund balance, requiring zero additional saving or risk. Use the calculator to see what your current balance earns at both rates.