Bank of America's flagship savings account still pays a fraction of what competitors offer, and depositors are noticing the gap in their monthly statements.
The bank's standard savings rate sits at 0.01% annual percentage yield, according to its published rate sheet, a figure that has barely budged even as the Federal Reserve held its benchmark rate in a range that keeps money market funds and online banks paying north of 4%.
A customer parking $10,000 in a standard BofA savings account earns about $1 a year.
The same balance at an online-only bank paying 4.00% APY would generate roughly $400 — a difference that compounds the longer the money sits.
Big national banks lean on branch networks, brand trust and sticky deposits, so they rarely feel pressure to compete on yield for everyday savers.
Online banks carry almost no branch overhead, which lets them pass along higher rates to pull in deposits.
The result is a two-tier savings market that has quietly widened since 2022.
Bank of America does offer higher yields through some products, including promotional offers on certain savings tiers and its Preferred Rewards program, where rates can climb for customers who hold larger combined balances across the bank.
But those tiers come with balance requirements and conditions, meaning the headline 0.01% is what most casual savers actually get.
For households already squeezed by grocery bills, rent and credit card APRs that can top 20%, the low yield is a double hit.
Money that could be earning meaningful interest is instead losing ground to inflation, which has cooled but still erodes purchasing power over time.
Savers effectively pay a "convenience tax" for keeping cash at the same bank where they write checks and swipe a debit card.
Switching isn't as painful as it once was.
Many online banks let you open an account in minutes, link it to an existing checking account, and transfer funds electronically with no fees.
The tradeoff is losing in-person branch service, which matters to some customers and not at all to others.
A middle path works for plenty of people: keep a small buffer at the big bank for bills and ATM access, then move the rest to a high-yield account.
That keeps day-to-day banking simple while letting the bulk of savings actually earn something.
It's the kind of move that takes about fifteen minutes and can be reversed anytime.
One caution: yields are variable, and rates at online banks can drop if the Fed cuts.
A promotional rate today isn't a locked-in return tomorrow.
Savers should check the fine print on balance caps, monthly fees and withdrawal limits before assuming a headline APY applies to their full balance.
The bigger takeaway is that loyalty to a single institution rarely pays interest.
Banks count on inertia, and the spread between 0.01% and 4% is essentially the price of not checking.
Final Thoughts
A quick comparison of what your current bank pays versus what's available elsewhere is the cheapest financial move most people can make this month.