Bank of America customers are earning a fraction of what savers at online banks collect, and many have no idea.
The Charlotte-based giant still pays 0.01% APY on its standard savings account.
That's one cent per $100 saved, per year.
Meanwhile, a long list of FDIC-insured online banks and money market accounts have spent the past two years paying in the 4% to 5% range.
The difference isn't hidden in fine print—it's on the bank's own rate disclosures.
What keeps customers in place is inertia.
Switching feels like a hassle, and the big-bank branch down the street feels safe.
Bank of America does offer a higher-yield option through its Preferred Rewards program, but it comes with strings.
You generally need $20,000 or more in combined balances across checking and savings to qualify, and even the top tier doesn't match what many online banks pay with no minimum at all.
The biggest catch is what the big banks are actually doing with your money.
They lend it out at much higher rates—through credit cards charging over 20%, auto loans, and mortgages—while paying depositors almost nothing.
That spread is a big part of how they profit.
If you're parked at a traditional bank out of habit, here's the practical move.
Keep enough in checking to cover a month of bills and avoid fees.
Move the rest to a high-yield savings account, ideally one that's FDIC-insured, has no monthly fee, and lets you transfer back in a day or two.
Look for minimum balance requirements, withdrawal limits, and whether the rate is promotional or ongoing.
Some accounts advertise a high rate but drop it after a few months.
A genuinely competitive account tends to stay competitive.
Branch staff sometimes steer customers into products that carry fees or lock up cash.
A simple savings account at an online bank usually has none of that.
This isn't about Bank of America being uniquely bad.
Most of the largest banks pay similarly low rates, because they don't need to compete for deposits the way smaller institutions do.
The point is that loyalty to a brand name rarely pays off in the savings aisle.
Someone who leaves $25,000 sitting in a low-rate account for five years could miss out on thousands in interest, even accounting for rate changes.
That's real money that could go toward an emergency fund, a car repair, or a down payment.
One more thing worth checking: whether your current bank quietly lowered your rate without telling you.
Rates change, and it's worth a quick look at your last statement to see what you're actually earning.
My take: the biggest financial mistake here isn't picking the wrong bank—it's never checking.
Rates move, banks change their terms, and a few minutes comparing options can be worth hundreds or thousands a year.
Final Thoughts
Set a reminder to review your savings rate every six months, and don't assume the bank you've trusted for years is giving you a fair deal.