High-Yield Savings Yield Calculator
Calculate exactly how much your high-yield savings account will earn after taxes. See daily compounding, monthly contributions, and a year-by-year projection over 5 years.
Year-by-Year Projection
How High-Yield Savings Account APY Works
Annual Percentage Yield (APY) reflects the actual yearly return when interest compounds. Most HYSAs compound daily and credit interest monthly. The APY differs from the simple annual rate (APR) — for example, a 4.40% APR with daily compounding produces a 4.50% APY. The Federal Truth in Savings Act requires banks to disclose APY in any savings account advertising, allowing apples-to-apples comparison (source: 12 CFR 1030.4, Regulation DD). HYSAs are FDIC-insured up to $250,000 per depositor per insured bank.
2026 HYSA Rate Outlook
HYSA rates closely follow the federal funds rate. After the Fed cut rates 4 times during 2024-2025, the federal funds rate sits at 4.00-4.25% in early 2026 and HYSA APYs run 3.75-4.75% at top online banks. Online-only banks (Ally, Marcus by Goldman Sachs, Discover, SoFi, Capital One 360) consistently offer 0.50-1.00% higher APYs than traditional brick-and-mortar banks because they don't pay for branches. Traditional bank savings accounts often pay 0.01-0.10% APY — switching to an online HYSA on a $20,000 balance saves $800-$900 per year in lost interest (source: FDIC National Rates and Rate Caps, fdic.gov).
HYSA Tax Treatment
Interest from HYSAs is taxable as ordinary income at the federal level — taxed at your marginal rate (10% to 37%). State tax also applies in most states. Banks issue Form 1099-INT for interest over $10. Strategy: hold HYSA balances inside a Roth IRA where possible to make the interest tax-free; outside an IRA, accept the tax cost as the price of liquidity. Compared to brokerage money market funds (similar yields, also taxable) or Treasury bills (state-tax-exempt — better for high-tax states), HYSAs win on simplicity and FDIC insurance. For amounts above $250,000 per bank, spread across multiple banks to maintain full FDIC coverage.
HYSA vs Money Market vs CD vs Treasury
HYSA: variable rate, fully liquid, FDIC-insured to $250K. Money Market Account: similar but may offer check-writing. Money Market Fund (brokerage): slightly higher yield often, NOT FDIC but very safe (SIPC-protected, holds short-term Treasuries). CD: locked rate but locked term with early-withdrawal penalty. T-Bill: locked rate, full liquidity via secondary market, state-tax exempt. For pure emergency funds, HYSA is best because it combines high yield, full liquidity, and FDIC safety. For amounts above $250K, mix HYSA with T-Bills. Last updated: April 2026.