Bank of America customers hoping their savings account is quietly keeping pace with inflation may want to sit down.
The bank's standard savings rate still hovers around 0.01% APY, a figure that has barely budged even as the Federal Reserve spent years pushing its benchmark rate to levels not seen in over two decades.
The Fed's moves ripple through mortgages, credit cards, and car loans almost immediately—but the money sitting in a big-bank savings account often collects almost nothing.
Park $10,000 in a Bank of America standard savings account for a full year, and you'd earn roughly $1.
Meanwhile, the same $10,000 in a high-yield savings account paying around 4% would generate about $400.
Same money, same risk profile, wildly different outcome.
Big banks don't have to compete for deposits the way online banks do.
They have millions of customers who keep money parked out of habit, convenience, or because switching feels like a hassle.
That loyalty has a price, and depositors are the ones paying it.
Bank of America does offer higher yields through its Preferred Rewards program, but there's a catch.
You typically need a qualifying balance across BofA and Merrill accounts—often $20,000 or more—to unlock meaningfully better rates.
For the average household with a few thousand dollars saved, that door stays closed.
Meanwhile, the cost of borrowing at the same bank hasn't been shy.
Credit card APRs at major issuers have pushed past 20% for many cardholders.
So the bank pays you a fraction of a percent on your deposits while charging you 20% or more when you carry a balance.
That spread is how the business works—but it's worth understanding when you're deciding where your emergency fund lives.
The Fed's recent signals suggest rate cuts could be on the table, which means the window on today's elevated high-yield savings rates may not stay open forever.
When the Fed cuts, yields on online savings accounts tend to drift down too—though they usually stay far above the 0.01% floor at traditional banks.
Grocery bills, rent, and insurance premiums haven't gotten the memo about cooling off.
Eggs, beef, and rent in many metro areas are still squeezing household budgets.
Every dollar of interest you're not earning is a dollar that isn't helping offset those costs.
Switching doesn't require closing your Bank of America checking account.
Many people keep their day-to-day banking where it is and simply move savings to an FDIC-insured online account.
Transfers typically take a day or two, and your money stays protected up to applicable limits.
The takeaway isn't that Bank of America is doing anything illegal—it's that inertia is expensive.
If your savings are earning 0.01%, you're effectively lending your money to the bank for free while inflation eats its value.
Our take: loyalty to a big bank's savings account rarely pays off in dollars.
Final Thoughts
Spend ten minutes comparing rates, and you'll likely find hundreds of dollars a year you didn't know you were leaving on the table.